A consumer consumes only two goods.explain the equilibrium with the help of utility approach
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.A consumer consumes only two goods and is in equilibrium. Show that price and ... Explain the conditions of consumer's equilibrium with the help of utility analysis.
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Answer: Consumer's equilibrium
Explanation:
A consumer's equilibrium can be defined to the rule of equal marginal utility, the consumer should utilize his limited resources in order to achieve maximum usefulness in such a way that marginal utility obtained from the final units of different items used.
Suppose price of a commodity increase then it demand will fall, but the demand of other commodity will increase so that the proportion will be restored.
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