Q204
When Marginal Utility is zero, Total Utility is
A.
Minimum
B.
Maximum
AnswerC.
Law of return
D.
None of the above
Answer: Option B
Solution
Answer: Option B
Solution:
When Marginal Utility is zero, Total Utility is maximum. It is based in the law of diminishing marginal utility which says 'as more and more units of a good are consumed, MU i.e level of satisfaction derived from each successive unit goes on falling because desire for that commodity tend to fall.