A decrease in consumption will result in
A) both total utility and marginal utility decreasing.
B) total utility increasing, but marginal utility decreasing.
C) total utility decreasing, but marginal utility increasing.
D) both total utility and marginal utility increasing.

Question

Quizplus · Accepted Answer

A decrease in consumption typically leads to a decrease in total utility because fewer goods are being consumed. However, marginal utility may increase because the remaining units of consumption are valued more highly, as per the law of diminishing marginal utility.

A Decrease in Consumption Will Result in