Total utility is maximum when _________.

marginal utility is zero

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marginal utility is at its highest point

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marginal utility is equal to average utility

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average utility is maximum

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Solution

The correct option is B marginal utility is zero
When marginal utility is zero total utility is maximum as after that any further consumption will lead to negative marginal utility and fall in total utility.

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Similar questions

When marginal utility is zero, total utility is:

a. Zero

b. Minimum

c. Maximum

d. Negative

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