The below figure shows the various combinations of the goods X and Y that yield different levels of utility.Figure 7.3

-As the price of a good increases, the marginal utility per dollar spent on that good will also increase.

Question

The below figure shows the various combinations of the goods X and Y that yield different levels of utility.Figure 7.3
 
-As the price of a good increases, the marginal utility per dollar spent on that good will also increase.

Quizplus · Accepted Answer

As the price of a good increases, the marginal utility per dollar spent on that good will decrease. This is because the consumer has to give up more of their budget to purchase the same quantity of the good, reducing the overall satisfaction derived from consuming that good.

The Below Figure Shows the Various Combinations of the Goods