Exhibit 6-3 Marginal utility data for goods X and Y $$\begin{array} { | c | c | c | c | }
\hline \text { Units of good X } & \begin{array} { c }
\text { Marginal utility of } \
\text { good X }
\end{array} & \text { Units of good Y } & \begin{array} { c }
\text { Marginal utility of } \
\operatorname { good~Y }
\end{array} \
\hline 1 & 20 & 1 & 14 \
2 & 16 & 2 & 12 \
3 & 12 & 3 & 10 \
4 & 8 & 4 & 8 \
5 & 4 & 5 & 6 \
\hline
\end{array}$$
-According to the utility model of consumer demand, the demand curve is downward-sloping because of the law of:
A) diminishing marginal utility.
B) diminishing consumer equilibrium.
C) consumer equilibrium.
D) diminishing utility maximization.

Question

Exhibit 6-3 Marginal utility data for goods X and Y $$\begin{array} { | c | c | c | c | } 
\hline \text { Units of good X } & \begin{array} { c } 
\text { Marginal utility of } \
\text { good X }
\end{array} & \text { Units of good Y } & \begin{array} { c } 
\text { Marginal utility of } \
\operatorname { good~Y }
\end{array} \
\hline 1 & 20 & 1 & 14 \
2 & 16 & 2 & 12 \
3 & 12 & 3 & 10 \
4 & 8 & 4 & 8 \
5 & 4 & 5 & 6 \
\hline
\end{array}$$
-According to the utility model of consumer demand, the demand curve is downward-sloping because of the law of:
A) diminishing marginal utility.
B) diminishing consumer equilibrium.
C) consumer equilibrium.
D) diminishing utility maximization.

Quizplus · Accepted Answer

The demand curve is downward-sloping due to the law of diminishing marginal utility, which states that as a consumer consumes more units of a good, the additional satisfaction (marginal utility) from each additional unit decreases. This leads consumers to be willing to pay less for additional units, resulting in a downward-sloping demand curve.

Exhibit 6-3 Marginal Utility Data for Goods X and Y