When the total utility is increasing at an increasing rate, marginal utility is___________?a)Increasingb)Constantc)Negatived)DecreasingCorrect answer is option 'A'. Can you explain this answer?

Question

Answer

The correct option is D.

Total utility refers to the total satisfaction obtained from the consumption of all possible units of a commodity. Marginal utility is the additional utility derived from the consumption of one more unit of the given commodity. MU=TUn-TUn-1.So when TU is increasing at an increases this means utility derived from each unit is increasing. This means marginal utility is increasing.

Answer

MU is additional utility derived from consumption

of one more unit of a commodity.TU is total utility derived from consumption of all units of a commodity.TU= MU(1st unit)+ MU(2nd

Answer

It is because utility means wants satisfying power of a common unit when wants are increasing,satisfaction also increasing. total utility means total satisfaction or marginal means additional so additional satisfaction will also increase.

Answer

When the total utility is increasing at an increasing rate, it means that each additional unit of a good or service consumed is providing more satisfaction or utility than the previous unit. In this scenario, the marginal utility is increasing.

To further understand this concept, let's break it down into the following points:

1. Total Utility:
Total utility refers to the overall satisfaction or pleasure derived from consuming a certain quantity of a good or service. It is the sum of the marginal utilities of all the units consumed.

2. Marginal Utility:
Marginal utility is the additional utility gained from consuming one more unit of a good or service. It measures the change in total utility resulting from the consumption of an additional unit.

3. Relationship between Total Utility and Marginal Utility:
The relationship between total utility and marginal utility is crucial in understanding consumer behavior. Marginal utility directly influences the total utility.

- When the total utility is increasing at an increasing rate, it means that the additional units of the good or service consumed are providing more satisfaction than the previous units. This implies that the marginal utility is positive and increasing.

- If the marginal utility is constant, it means that each additional unit consumed provides the same level of satisfaction as the previous unit. In this case, the total utility will increase, but at a constant rate.

- When the marginal utility is negative, it means that each additional unit consumed provides less satisfaction than the previous unit. This situation occurs when a person experiences diminishing marginal utility, where the satisfaction gained from each additional unit decreases.

- Lastly, when the marginal utility is decreasing, it means that each additional unit consumed provides less satisfaction than the previous unit, but the rate of decrease is diminishing. The total utility is still increasing, but at a decreasing rate.

In summary, when the total utility is increasing at an increasing rate, the marginal utility is positive and increasing. This signifies that each additional unit consumed is adding more satisfaction and contributing to the overall increase in total utility.

Answer

Acc to its ans is D because of DMU

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