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Which of the following statement is correct? (a) When MU is negative, TU will be increasing (b) When MU is positive, TU will be decreasing (c) When MU is zero, TU is maximum

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Question

Which of the following statement is correct?

Options

  • When MU is negative, TU will be increasing

  • When MU is positive, TU will be decreasing

  • When MU is zero, TU is maximum

  • None of these

MCQ
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Solution

When MU is zero, TU is maximum

Explanation:

Positive MU adds to TU, while negative MU reduces TU. When MU is zero, TU is at its maximum.

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Chapter 3: Theory of Consumer Behaviour: Marginal Utility and Indifference Curve Analysis - TEST YOURSELF QUESTIONS [Page 50]

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Frank Economics [English] Class 12 ISC
Chapter 3 Theory of Consumer Behaviour: Marginal Utility and Indifference Curve Analysis
TEST YOURSELF QUESTIONS | Q 8. | Page 50
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