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Question

At point of satiety, marginal utility is _____.

A
Zero
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B
Positive
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C
Maximum
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D
Negative
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Solution

The correct option is A Zero
In economics, the point of satiety is defined as the point when the marginal utility of any activity is zero. From this point on, the marginal utility actually turns negative. Expressed differently, the point of satiety reflects that point when the total utility has been maximized. From here on, the total utility actually reduces. Every extra effort leads to negative returns.

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