A consumer's utility is maximized when the marginal utilities derived from additional units of goods:
A)are less than their market prices.
B)are equal to the total utilities derived from the consumption.
C)are maximized.
D)are equal to the opportunity costs of producing additional units of goods.
E)are exactly proportional to their market prices.

Question

A consumer's utility is maximized when the marginal utilities derived from additional units of goods:​
A)are less than their market prices.
B)are equal to the total utilities derived from the consumption.
C)are maximized.
D)are equal to the opportunity costs of producing additional units of goods.
E)are exactly proportional to their market prices.

Quizplus · Accepted Answer

A consumer's utility is maximized when the ratio of the marginal utility to the price of each good is equal across all goods, meaning the marginal utilities are proportional to their market prices.

A Consumer's Utility Is Maximized When the Marginal Utilities Derived