Which of the following is considered to be a tell-tale signal that the point with the highest total utility has been found?
A) the marginal utility per dollar is the same for both goods
B) the marginal utility per dollar is controlled by trade-offs
C) the quantities demanded change so total utility rises
D) the demand curves are flatter reducing quantity

Question

Quizplus · Accepted Answer

When the marginal utility per dollar spent on each good is the same, it indicates that the consumer has allocated their budget in a way that maximizes total utility. This is a key principle of consumer equilibrium in microeconomic theory.

Which of the Following Is Considered to Be a Tell-Tale