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JAMB Economics 2012 Question 12

Question 12

Theory of Consumer Behaviour

When the slope of the total utility curve is declining, the marginal utility of a consumer will be increasing if he

  1. A.stops consuming more of the commodity
  2. B.reduces the quantity consumed
  3. C.increases the quantity consumed
  4. D.consumes more of another commodity.
Show the answer and explanation

Answer: B (reduces the quantity consumed)

Explanation

The slope of total utility is marginal utility. It declines as consumption rises, so to raise marginal utility the consumer must reduce the quantity consumed.