Utility maximization _______ the law of demand.
A) has no relation to
B) underlies
C) is OK in theory, but does not support in fact,
D) is generally inconsistent with

Question

Quizplus · Accepted Answer

Utility maximization is the underlying principle of the law of demand. Consumers aim to maximize their utility or satisfaction from goods and services while facing budget constraints. The law of demand states that as the price of a good or service increases, the quantity demanded decreases, which is a direct application of the principle of utility maximization.

Utility Maximization _______ the Law of Demand