What will be the value of Marginal utility of the 4th unit
Units consumed Total Utility derived (utils) 1 10 2 8 3 5 4 2
What will be the value of Marginal utility of the 4th unit
| Units consumed | Total Utility derived (utils) |
|---|---|
| 1 | 10 |
| 2 | 8 |
| 3 | 5 |
| 4 | 2 |
Solution
✅ Correct Option: 2
Option 2: -3 utils -> Marginal Utility (MU) is the change in total utility from consuming an additional unit. MU of 4th unit = Total Utility at 4 units - Total Utility at 3 units = 2 - 5 = -3 utils. This negative marginal utility indicates that consuming the 4th unit actually decreases overall satisfaction, suggesting the consumer has passed the point of maximum utility. -> correct
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