Question

Explain the relationship between marginal utility and total utility

Answer 1

Answer:

Total utility is the sum total of utilities obtained by the consumer from different units of a commodity. In our illustration, the total utility of two apples is 35 = (20 + 15) utils, of three apples 45 = (20 + 15 + 10) utils, and of four apples 50=(20+15+10+5) utils.

Marginal utility is the addition made to total utility by having an additional unit of the commodity. The total utility of the two apples is 35 utils. When the consumer consumes the third apple, the total utility becomes 45 utils. Thus, marginal utility of the third apple is 10 utils (45—35)

Answer 2

The relationship between total and marginal utility :-

• TU and MU both starts from same point .

• As TU increases , MU falls by consuming every additional unit of good or service .

• When TU at its maximum level , MU is Zero .

• When TU starting decline , at the same time MU tends to negative .