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प्रश्न
Explain the Law of Equi-Marginal Utility.
State the law of equi-marginal utility.
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उत्तर
The law of equimarginal utility states that a consumer allocates his expenditure on various commodities in such a manner that the utility derived from each additional rupee spent on each of the commodities is equal. Algebraically, this is represented as the following equality.
`(MU_x)/(P_x) =(MU_y)/(P_y) = (MU_m)/(P_n) = ...MU_m`
In the above figure, OO1 represents the total income of a consumer. MUx and MUy represent the Marginal Utility curves of commodity x and commodity y, respectively. Point E represents the point of the consumer's equilibrium, where:
`(MU_x)/(P_x) = (MU_y)/(P_y) = MU_m`
At this point, OM amount of income is spent on commodity x and the remaining amount ofincome,e MO1 is spent on commodity y.
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संबंधित प्रश्न
Explain the relationship between Total utility and Marginal utility.
State whether the following statements are TRUE or FALSE:
Marginal utility increases with increase in consumption.
Choose the correct answer :
The capacity of a commodity to satisfy human want is known as _________.
Do you agree with the following statements? Give reasons.
Marginal utility and Total utility is same.
Fill in the blanks with appropriate alternatives given in the bracket.
Marginal consumption function is always ________.
Fill in the blank with appropriate alternatives given below:
Marginal utility diminishes, as consumption of commodity ________.
Fill in the blank with appropriate alternatives given below:
_________________ utility is the utility derived from the last unit of the commodity consumed.
Fill in the blank with appropriate alternatives given below:
When MU is ______________ TU decreases.
State the following statement is True or False:
MU and TU are equal at the initial stage.
Define the following concept:
Total utility
Explain the following concept:
Marginal utility
Give reason or explain:
Utility is a psychological term.
Answer the following question:
Explain the relationship between TU and MU.
Define marginal utility.
Answer the following question.
Discuss briefly, using a hypothetical schedule, the relation between marginal utility and total utility.
Choose the correct answer from given options
When marginal utility is zero, total utility is
What does total utility (TU) represent?
What happens to marginal utility as more units of a good are consumed?
What is the consequence of continuing to consume after marginal utility becomes negative?
