Question

Assertion (A): Demand curve shows the inverse relation between the own price of a good and its quantity demanded.

Reason (R): Law of diminishing marginal utility which advocates that the consumer gets lesser satisfaction from each additional unit of a good consumed.

Options

• Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).

• Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of Assertion (A).

• Assertion (A) is true, but Reason (R) is false.

• Assertion (A) is false, but Reason (R) is true.

Answer 1

Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of Assertion (A).

Explanation:

Both statements are true. Diminishing marginal utility means each additional unit gives less satisfaction, so consumers will generally buy more only at a lower price; this helps explain the inverse price–quantity relationship shown by the demand curve.