Question

2. When TU is maximum then MU is?
(a) zero
(b) negative (c) both (a) and (b) (a) none of these
3. Marginal Utility is zero when Total Utility is
pero
(b) increasing (c) highest
d) decreasing​

Answer 1

Explanation:

When TU reaches its maximum, MU becomes zero.

Answer 2

The correct answer is option 2. (a) zero 3. (c) highest.

Explanation:

• When TU is maximum then MU is zero.
• Marginal means over and above the total by additional quantity whereas Total Utility refers to the total satisfaction derived by the consumption of sum of quantities of a commodity.
• The rate of change in TU is MU.
• At the initial level of consumption MU increases and TU also increases but when it reaches at is maximum there is a saturation point of consumption where MU is ZERO and TU is maximum and remains constant and then MU starts negative and TU  starts declining.