Question

The law of equi- marginal utility explains equilibrium of the _______.

• A. consumer
• B. producer
• C. economy
• D. state

Answer 1

The correct option is A consumer

• The law of equi-marginal utility is an extension of law of DMU. It states that with the limited that a person has, he aims to spend it on different commodities and earn maximum and equal satisfaction from them.
  
• He should such a combination of goods so that the utility derived from the last unit of the goods are the same.
  
• Thus, it aims to establish equilibrium at that point where the consumers gets maximum satisfaction by consuming a particular combination of goods.