Question

What happens to Marginal Utility (MU) as more units are consumed, while Total Utility (TU) is still increasing?

Options

• MU increases rapidly

• MU stays constant

• MU decreases but remains positive

• MU becomes negative

Answer 1

MU decreases but remains positive.

Explanation:

As more units are consumed, TU increases at a slower rate because MU, though positive, continues to decrease.