If the consumer consumes only one commodity 'X', he will be in equilibrium when _________.
[Here, $M U_{X} =$ Marginal utility of the Good $- X$ (in terms of money); $P_{X} =$ Price of Good $- X$ .]

M U_{X} < P_{X}

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M U_{X} = P_{X}

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M U_{X} > P_{X}

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none of these

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Solution

The correct option is B $M U_{X} = P_{X}$
Consumer will achieve equilibrium only when the price of the commodity which consumer is willing to pay matches the utility which the consumer is getting from the consumption in the units of money ie $M U_{X} = P_{X}$

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Similar questions

\frac{M U_{X}}{P_{X}} = M U_{M}

A consumer, Mr. Aman is in state of equilibrium consuming two goods X and Y. with given prices Px and Py. Explain what will happen if :

a. MUx / Px is greater than MUy / Py.

b. Py falls

\frac{M U_{X}}{P_{X}} > \frac{M U_{Y}}{P_{Y}}

M U_{X} = M U_{Y} = M U_{M}

P_{X}

P_{Y}

\frac{P_{X}}{P_{Y}} > \frac{M U_{X}}{M U_{Y}}

\frac{P_{X}}{P_{Y}} = \frac{M U_{X}}{M U_{Y}}

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