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| 1. |
Define marginal utility. State the law of DMU |
| Answer» <html><body><p></p>Solution :Marginal <a href="https://interviewquestions.tuteehub.com/tag/utility-1441817" style="font-weight:bold;" target="_blank" title="Click to know more about UTILITY">UTILITY</a> quantifies the added satisfaction that a consumer garners from consuming additional units of goods or services. The concept of marginal utility is used by economists to determine how much of an item consumers are willing to purchase. <br/>The Law Of Diminishing Marginal Utility states that all else equal as consumption <a href="https://interviewquestions.tuteehub.com/tag/increases-1040626" style="font-weight:bold;" target="_blank" title="Click to know more about INCREASES">INCREASES</a> the marginal utility derived from each additional <a href="https://interviewquestions.tuteehub.com/tag/unit-1438166" style="font-weight:bold;" target="_blank" title="Click to know more about UNIT">UNIT</a> declines. Utility is an <a href="https://interviewquestions.tuteehub.com/tag/economic-448435" style="font-weight:bold;" target="_blank" title="Click to know more about ECONOMIC">ECONOMIC</a> term used to <a href="https://interviewquestions.tuteehub.com/tag/represent-613876" style="font-weight:bold;" target="_blank" title="Click to know more about REPRESENT">REPRESENT</a> satisfaction or happiness.</body></html> | |