Quiz 3.3 - RELATIONSHIP BTW MARGINAL UTILITY AND DEMAND CURVE

The demand curve slopes downward mainly because:

A. Marginal utility increases with consumption

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B. Marginal utility diminishes with consumption

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C. Total utility decreases with consumption

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D. Marginal cost always falls

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The law of diminishing marginal utility explains why:

A. The supply curve slopes upward

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B. The demand curve slopes downward

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C. Price remains constant

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D. Total utility keeps rising forever

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Marginal utility is the additional satisfaction a consumer derives from:

A. The first unit of a good

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B. Any unit of a good consumed

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C. One more unit of a good

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D. The last unit only

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When marginal utility equals zero, total utility is:

A. Falling

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B. Maximum

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C. Minimum

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D. Constant

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A rational consumer will continue to purchase a commodity until:

A. Price = Average Utility

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B. Price = Total Utility

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C. Price = Marginal Utility

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D. Price = Marginal Cost

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The downward slope of the demand curve is due to:

A. Increasing marginal utility

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B. Constant marginal utility

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C. Diminishing marginal utility

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D. Negative total utility

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If the marginal utility of a commodity is higher than its price, the consumer will:

A. Reduce consumption

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B. Increase consumption

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C. Remain indifferent

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D. Stop buying immediately

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Which of the following correctly links demand and marginal utility?

A. Higher MU → lower demand

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B. Lower MU → higher demand

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C. Higher MU → higher demand

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D. MU has no relation to demand

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As consumption increases, marginal utility falls, leading to:

A. Higher willingness to pay

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B. Lower willingness to pay

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C. No change in willingness to pay

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D. Negative demand

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The consumer’s demand curve can be derived from:

A. The marginal cost curve

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B. The total utility curve

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C. The marginal utility curve

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D. The production function

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Quiz 3.3 – RELATIONSHIP BTW MARGINAL UTILITY AND DEMAND CURVE

Quiz 3.3 – RELATIONSHIP BTW MARGINAL UTILITY AND DEMAND CURVE

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