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Utility & Consumer's Equilibrium · Question 35 of 73

Question 35

MediumOriginal question

Read the two statements and choose the correct option.

I. The law of diminishing marginal utility assumes that the consumer's tastes do not change.

II. The law of diminishing marginal utility assumes that the consumer is rational.

Options for question 35

Show the answer and explanation
CorrectNot quiteAnswer C

Correct answer: C

Explanation

  1. Both are standard assumptions of the law.

  2. A change in tastes or irrational behaviour would break the steady fall in MU.

Concept
More assumptions of the law
Typical time
70 s
Your time
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The rule this testsDiminishing marginal utility
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Ten questions from Utility & Consumer's Equilibrium, at your own pace.

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