Law of Diminishing Marginal Utility

Q.

Give reasons or explain: utility is a subjective concept

Q.

Write down the formula of calculating purchasing power of one rupee when the cost of living index is given at some base period.

Q.

What is the formula for marginal utility?

Q. Define marginal product ?

Q.

What is the formula for marginal utility?

Q. Formula for calculation of total utility is ________.

1. both A and B
2. none of the above
3. $TU=\sum MU$
4. $TU=M{U}_1+M{U}_2+M{U}_3+.......+M{U}_n$

Q.

What is the formula for marginal utility?

Q.
With the increase in consumption by one unit of the commodity, TU increases from 150 to 180, then marginal utility is _________.

1. 50
2. 1.2
3. 30
4. 0.833

Q. When total utility increases, marginal utility is _________.

1. Negative and declining
2. Negative and increasing
3. Zero
4. Positive and declining

Q. Given the market price of a good, how does a consumer decide as to how many units of that good to buy? Explain.

Q. The Law of diminishing marginal utility states that _______.

1. with successive increase in consumption of additional unit marginal utility also increases
2. none of the above
3. with successive increase in consumption of additional unit marginal utility remain constant
4. with successive increase in consumption of additional unit marginal utility also decreases

Q. MRS between goods X and Y is determined by the prices of these goods in the market. Is it true?

Q. Marginal utility diminishes as consumption of commodity _________.

1. increases
2. decreases
3. remains constant
4. become zero

Q. According to the law of diminishing marginal utility, at what rate does total utility increase and what happens to marginal utility?

1. TU increases at decreasing rate and MU falls
2. TU increases at increasing rate and MU falls
3. TU remains constant and MU falls
4. TU decreases and MU rises

Q. When the marginal utility of a commodity is high, its price is low.

1. True
2. False

Q.
A consumer will buy more of a commodity even when MU of every successive unit tends to decrease.

1. True
2. False

Q. Higher consumption of a commodity may mean lower and lower marginal utility, but it never implies negative utility. Do you agree?

Q. Explain the conditions of consumer's equilibrium with the help of marginal utility analysis.

Q. The law of diminishing marginal utility explains economic behavior of a rational consumer.

1. True
2. False

Q. An economy is in equilibrium. Find autonomous consumption expenditure:
National Income = 1, 600
Investment Expenditure = 300
Marginal Propensity to Consume =0.8
(Autonomous Consumption Expenditure = 20)

Q. An increase or decrease in consumption of a goods or services is termed as ____________________.

1. Marginal utility
2. Total utility
3. Producer's equilibrium.
4. Revenue curves.

Q. Who is the main propounder of the marginal utility analysis?

1. J.M. Keynes
2. Hicks
3. Paul Samuelson
4. Marshall

Q. Which of the following equations is incorrect?

1. $MU=T{U}_{n+2}-T{U}_{n+1}$
2. $MU=\frac{TU}{Q}$
3. $TU=\sum MU$
4. $MU=T{U}_n-T{U}_{n-1}$

Q. A utility function is a description statement that relates total utility to ___________.

1. price
2. the production of goods and services
3. income
4. the consumption of goods and services

Q. Define total utility.

Q. Ordinal utility analysis of the consumers behaviour is considered superior to the cardinal utility analysis mainly due to ___________________.

1. Assumption of the rationality of the consumers behaviour
2. Possibility of the derivation of the consumers demand
3. Bifurcation of price effects into income and substitution effects
4. Consideration of the available limited resources for satisfying consumers demand

Q. Define marginal utility.

Q. When a consumer buys a good which of the following is the concept that is Not generated when taking care of utility?

1. Sum utility
2. Total utility
3. Marginal utility
4. Average utility

Q. Statement I:
Utility of a good to the consumer should be measured in units of money which the consumer is willing to pay.
Statement II:
Utility and usefulness are one and same thing.
Select the correct answer from the options given below -

1. Both Statement I and Statement II are time.
2. Statement II is true but Statement I is false.
3. Both Statement I and Statement II are false.
4. Statement I is true but Statement II is false.

Q. Which of the following statements is the contrapositive of "If you understand logic, you will be a good consumer."?

1. If you do not understand logic, then you will not be a good consumer.
2. If you are a good consumer, then you do not understand logic.
3. None of these
4. If you are not a good consumer, then you do not understand logic.