If total utility has reached a maximum level, and assuming that diminishing marginal utility already applies, then what will happen as the consumer consumes additional units of the product?
A)Marginal utility of the additional units will be greater than zero.
B)Total utility will turn negative.
C)Marginal utility of the additional units will turn negative.
D)Total utility will increase at a diminishing rate.

Question

Quizplus · Accepted Answer

When total utility has reached its maximum level, consuming additional units will lead to a decrease in satisfaction for those additional units, which is represented by a negative marginal utility. This is because the principle of diminishing marginal utility states that as more units of a product are consumed, the additional satisfaction gained from consuming each additional unit decreases, eventually becoming negative once total utility starts to decline.

If Total Utility Has Reached a Maximum Level, and Assuming