The demand curve for macadamia nuts is downward sloping.This slope is because consumers maximize their utility and an increase in the price of macadamia nuts leads to
A) no change in quantity demanded.
B) an increase in the marginal utility per dollar from macadamia nuts.
C) a decrease in the marginal utility per dollar from macadamia nuts.
D) consumers' budget lines rotating outward with their slopes changing.
E) consumers' budget lines shifting outward with no change in their slope.

Question

Quizplus · Accepted Answer

When the price of macadamia nuts increases, the marginal utility per dollar from macadamia nuts decreases, leading consumers to choose alternatives that provide a higher level of utility. This leads to a decrease in the quantity demanded, causing the demand curve to slope downward.

The Demand Curve for Macadamia Nuts Is Downward Sloping