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WAEC Economics 2016 Question 15

Question 15

Theory of Consumer Behaviour

One relationship between marginal utility and total utility is that when total utility is

  1. A.rising, marginal utility is rising.
  2. B.falling, marginal utility is negative.
  3. C.maximum, marginal utility is maximum.
  4. D.falling, marginal utility is rising.
Show the answer and explanation

Answer: B (falling, marginal utility is negative.)

Explanation

If total utility is falling, each extra unit subtracts satisfaction, so marginal utility is negative.