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JAMB Economics 2005 Question 32

Question 32

Theory of Consumer Behaviour

When the marginal utility of a commodity is zero, the total utility is

  1. A.at its minimum
  2. B.upward-sloping
  3. C.downward-sloping
  4. D.at its maximum
Show the answer and explanation

Answer: D (at its maximum)

Explanation

Total utility rises while marginal utility is positive and stops rising when marginal utility reaches zero, so it is at its maximum.