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You maximize utility when marginal utility divided by the price of product A is equal to the marginal utility divided by the price of product B.
MUa/Pa=MUb/Pb
or MUa/MUb= Pa/Pb
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Explain difference between total and marginal utility. Define UTILITY. How do consumers maximize UTILITY?
explain the difference between total utility and marginal utility
Total utility derived from consumption of a commodity by a consumer will be?
Will Be maximum when its marginal utility is Zero.
What are differences between marginal utility and total utility?
Topic Marginal Utility Total Utility 1. Definition Marginal utility is the extra satisfaction which a consumer gets from consuming additional units of goods. Total utility is the sum of total satisfaction of a consumer derives from consumption of a particular good. 2. Feature It can be negative. It can't be negative. 3. Sloping It is downward sloping. It is upward sloping.
Total utility is maximized when?
You maximize utility when marginal utility divided by the price of product A is equal to the marginal utility divided by the price of product B. MUa/Pa=MUb/Pb or MUa/MUb= Pa/Pb
What are the assumptions of cardinal utility approach?
Primarily cardinal utility approach has 5 assumptions. 1 rationality: the consumer is rational about his spending. 2 cardinal utility: the utility/satisfaction can be measured in cardinal NOs like 10, 8, 15, 20etc 3 constancy of money: The money of consumer must remain constant. 4 diminishing marginal utility: Marginal/additional utility of consumer decreases along with successive use of any commodity. 5 total utility: Total utility depends on quantity of commodity. 3
Suppose the MUP for bottled water is greater than the MUP for chips To maximize total utility the consumer should buy?
chips
Explain difference between total and marginal utility. Define UTILITY. How do consumers maximize UTILITY?
explain the difference between total utility and marginal utility
Total utility derived from consumption of a commodity by a consumer will be?
Will Be maximum when its marginal utility is Zero.
What are differences between marginal utility and total utility?
Topic Marginal Utility Total Utility 1. Definition Marginal utility is the extra satisfaction which a consumer gets from consuming additional units of goods. Total utility is the sum of total satisfaction of a consumer derives from consumption of a particular good. 2. Feature It can be negative. It can't be negative. 3. Sloping It is downward sloping. It is upward sloping.
Total utility is maximized when?
You maximize utility when marginal utility divided by the price of product A is equal to the marginal utility divided by the price of product B. MUa/Pa=MUb/Pb or MUa/MUb= Pa/Pb
What are the assumptions of cardinal utility approach?
Primarily cardinal utility approach has 5 assumptions. 1 rationality: the consumer is rational about his spending. 2 cardinal utility: the utility/satisfaction can be measured in cardinal NOs like 10, 8, 15, 20etc 3 constancy of money: The money of consumer must remain constant. 4 diminishing marginal utility: Marginal/additional utility of consumer decreases along with successive use of any commodity. 5 total utility: Total utility depends on quantity of commodity. 3
What will be the total utility derived from the consumption of a commodity by a consumer will be if marginal utility is zero?
i don't know the answer. i think it may be minimum or maximum.
How do households maximize utility?
Minimize usage.
Consumer equilibrium utility approach?
when does consumer attain equilibrium under the utility approach
What is average utility?
Average Utility is defined as the utility derived (or obttained) from the use of one unit of commodity. It is calculated by dividing the total number of utils by the number of units commodity is used by the consumer.
What will a rational consumer does?
A rational consumer is a consumer who hesitates to be satisfied with the little amount he has. A rational consumer, therefore tries to maximises inorder to get its total utility. He might not decide to draw a scale of preference because he has alimited resources.
Consumers use cost benefit in order to maximize what?
Consumers use cost-benefit analysis in order to maximize utility.
