total utility is maximum when:
a. marginal utility is zero
b. marginal utility is at its highest point
c.marginal utility is equal to average utility
d. average utility is maximum
Answers
Answer:
marginal utility is ZERO
Explanation:
Total utility is maximum when Marginal utility is zero. It is based in the law of diminishing marginal utility which says 'as more and more units of a good are consumed, MU i.e level of satisfaction derived from each successive unit goes on falling because desire for that commodity tend to fall..
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Answer:
Explanation:
Total utility is maximum when marginal utility is zero.
Marginal utility is the difference between then total utility of the current consumption and the total utility from the previous consumption, T(n) - T(n-1).where (n) is the number of units consumed.
When this difference is zero utility will be at its maximum.
Based on the diminishing law of marginal utility, utility or the satisfaction derived from the consumption of a good decrease with the number of units consumed. (the more you eat something, the less satisfaction you will derive from it)