Question : Which of the following statement is not true?
Option 1: As long as MU is positive, TU increases
Option 2: TU is zero when MU is zero
Option 3: TU starts decreasing when MU is negative
Option 4: After the point of satiety, MU becomes negative
Correct Answer: After the point of satiety, MU becomes negative
Solution : The correct answer is (d) After the point of satiety, MU becomes negative.
After the point of satiety, which is the point where the consumer reaches maximum satisfaction or utility from consuming a good, the marginal utility (MU) does not become negative. Instead, the marginal utility becomes zero. At the point of satiety, the consumer no longer derives any additional satisfaction from consuming more units of the good, but the marginal utility remains zero.
Question : Which of the following statement is correct? (a) TU increases till MU is positive. (b) TU is maximum when MU is equal to zero. (c) TU declines when MU is negative.
Option 1: A only
Option 2: B only
Option 3: A and B only
Option 4: A B and C
Question : Which of the following describes 'point of satiety' best
Option 1: TU starts falling
Option 2: TU reaches at its maximum
Option 3: MU is increasing
Option 4: TU is constant
Question : At the point of satiety MU will be:
Option 1: Positive
Option 2: Zero
Option 3: Rising
Option 4: None of these
Question : What will be marginal utility at the point of satiety?
Option 1: Negative
Option 2: Positive
Option 3: Zero
Option 4: None of the above
Question : When MU is positive, what happens to TU?
Option 1: It decreases.
Option 2: It becomes the highest.
Option 3: It remains constant.
Option 4: It increases.
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