1.

State the law of equi marginal utility.

Answer»

Law of Equi-marginal utility states that the consumer in order to maximize his satisfaction should spend his money on two goods in such a manner that the ratio of marginal utility of a commodity to its price becomes equal to the ratio of marginal utility of other commodities to its price. Symbolically,

MUx / Px = MUy/Py = MUn/Pn



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