An increase in the price of a good leads to a(n) ______ in the marginal utility per dollar of that good, and thus a(n) ______ in the quantity purchased.
A) increase; increase
B) increase; decrease
C) decrease; increase
D) decrease; decrease

Question

Quizplus · Accepted Answer

An increase in the price of a good decreases the marginal utility per dollar, leading to a decrease in the quantity purchased.

An Increase in the Price of a Good Leads to A(n)