In spending all his or her income, the consumer chooses the market basket that maximizes his or her utility. Which of the following statements will be correct? 1. The marginal utility is the same for each commodity. 2. The marginal utility per dollar spent is the same for each commodity. 3. The marginal utility of each commodity is proportional to its price. (A) 1 only. (B) 2 only. (C) 1 and 2 only. (D) 2 and 3 only.

1 mark, −0.33MicroeconomicsConsumer preferences and utilityMarginal utility and the equi-marginal principleModerateabout 1 min

UoH 2010 Question 75: Consumer preferences and utility

In spending all his or her income, the consumer chooses the market basket that maximizes his or her utility. Which of the following statements will be correct?

The marginal utility is the same for each commodity.
The marginal utility per dollar spent is the same for each commodity.
The marginal utility of each commodity is proportional to its price.

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Answer and worked solution

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Consumer preferences and utility has come up 93 times in 7 exams since 2007.

What this question tests

This question is on Marginal utility and the equi-marginal principle, part of Consumer preferences and utility in Microeconomics.

Diminishing marginal utility and the cardinal rule that a consumer equalises marginal utility per rupee across goods.

TestStop has 8 past-paper questions on this subtopic.

Practise Consumer preferences and utility More on Marginal utility and the equi-marginal principle

UoH 2010 Question 75: Consumer preferences and utility

In spending all his or her income, the consumer chooses the market basket that maximizes his or her utility. Which of the following statements will be correct?

The marginal utility is the same for each commodity.
The marginal utility per dollar spent is the same for each commodity.
The marginal utility of each commodity is proportional to its price.

Tap an option to check your answer.

Answer and worked solution

Checking your account…

Consumer preferences and utility has come up 93 times in 7 exams since 2007.

What this question tests

This question is on Marginal utility and the equi-marginal principle, part of Consumer preferences and utility in Microeconomics.

Diminishing marginal utility and the cardinal rule that a consumer equalises marginal utility per rupee across goods.

TestStop has 8 past-paper questions on this subtopic.

Practise Consumer preferences and utility More on Marginal utility and the equi-marginal principle

UoH 2010 Question 75: Consumer preferences and utility

Answer and worked solution

What this question tests

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UoH 2010 Question 75: Consumer preferences and utility

Answer and worked solution

What this question tests

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