Non satiety means that the marginal utility of a commodity never turns...
This is an assumption of IC which implies that the consumer has not reached the point of saturation in the consumption of any good. Thus, he always prefers to have more of both commodities. He always tries to move to a higher indifference curve to get higher and higher satisfaction.So it is correct that MU never turns -ve since more consumption means more TU.
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Non satiety means that the marginal utility of a commodity never turns...
Non satiety refers to the concept in economics that the marginal utility of a commodity never becomes negative. In order to understand whether this statement is true or false, it is important to first define marginal utility and then explore the concept of non satiety in detail.
Marginal Utility:
Marginal utility refers to the additional utility or satisfaction that a consumer derives from consuming an additional unit of a good or service. It is the change in total utility resulting from the consumption of one more unit of a commodity.
Non Satiety:
Non satiety, also known as the assumption of insatiability, is an assumption made in economics that individuals always desire more of a commodity. It implies that there is never a point where a consumer reaches complete satisfaction or satiety, and therefore the marginal utility of a commodity never becomes negative.
Understanding the Concept:
The concept of non satiety is based on the assumption that individuals have unlimited wants and desires, and thus, their utility from consuming additional units of a commodity never diminishes. This implies that the marginal utility of a commodity always remains positive or at least zero.
If the marginal utility of a commodity were to turn negative, it would imply that consuming an additional unit of the commodity reduces the consumer's total utility or satisfaction. However, this contradicts the concept of rational behavior, as individuals are assumed to always seek to maximize their utility.
Implications of Non Satiety:
The assumption of non satiety has several implications in economics. It helps in explaining why individuals continue to consume more of a commodity as long as it is available. It also justifies the law of demand, which states that as the quantity of a commodity consumed increases, the marginal utility derived from each additional unit decreases.
Non satiety also plays a crucial role in the theory of consumer behavior and the determination of consumer equilibrium. It helps in understanding the trade-offs that individuals make when allocating their limited resources among different goods and services.
Conclusion:
In conclusion, the statement that non satiety means the marginal utility of a commodity never turns to be negative is true. The assumption of non satiety is based on the idea that individuals always desire more of a commodity, and therefore, the marginal utility of a commodity never becomes negative. This assumption is fundamental in understanding consumer behavior and the determination of consumer equilibrium.
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