when the consumer consumes a same product at same time marginal utility of the derived product decreases and utility become negative. state whether the statement is true or false. explain this with the help of a diagram.
Answers
Answer:
What Is Marginal Utility?
Marginal utility is the added satisfaction that a consumer gets from having one more unit of a good or service. The concept of marginal utility is used by economists to determine how much of an item consumers are willing to purchase. Positive marginal utility occurs when the consumption of an additional item increases the total utility. On the other hand, negative marginal utility occurs when the consumption of one more unit decreases the overall utility.
KEY TAKEAWAYS
Marginal utility is the added satisfaction a consumer gets from having one more unit of a good or service.
The concept of marginal utility is used by economists to determine how much of an item consumers are willing to purchase.
The law of diminishing marginal utility is often used to justify progressive taxes.
Marginal utility can be positive, zero, or negative.
Explanation:
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