Like the law of demand, marginal utility analysis predicts that, ceteris paribus, an increase in the price of a product
A) leaves the quantity demanded unchanged.
B) increases the quantity demanded.
C) increases consumer surplus.
D) decreases the quantity demanded.

Question

Quizplus · Accepted Answer

Marginal utility analysis, like the law of demand, suggests that as the price of a product increases, ceteris paribus (all other factors being equal), consumers will demand less of it, hence decreasing the quantity demanded. This is because the higher price makes the product less attractive to consumers, assuming their utility or satisfaction from each additional unit decreases as they consume more.

Like the Law of Demand, Marginal Utility Analysis Predicts That