A change in the price of one good leads to all of the following,except one.Which is the exception?
A)a change in the slope of the budget line
B)a new point of consumer utility maximization
C)a change in the trade-off between the two goods
D)a change in the marginal utility of each unit of the good
E)a change in the marginal utility per dollar spent on the good

Question

Quizplus · Accepted Answer

A change in the price of one good does not directly lead to a change in the marginal utility of each unit of the good. Marginal utility is affected by the level of consumption, not the price. However, a change in price can indirectly affect marginal utility through changes in consumption and budget constraints.

A Change in the Price of One Good Leads to All