Figure 19-1.The figure shows a utility function.
-Refer to Figure 19-1.The utility function that is shown exhibits the property of diminishing
A) wealth.
B) utility.
C) marginal wealth.
D) marginal utility.

Question

Figure 19-1.The figure shows a utility function. 
-Refer to Figure 19-1.The utility function that is shown exhibits the property of diminishing
A) wealth. 
B) utility. 
C) marginal wealth. 
D) marginal utility.

Quizplus · Accepted Answer

The utility function shown in Figure 19-1 exhibits the property of diminishing marginal utility, which means that as consumption of a good or service increases, the additional satisfaction or utility derived from each additional unit decreases. This is reflected in the concave shape of the utility function.

Figure 19-1.The Figure Shows a Utility Function