If successive units of a good yield smaller and smaller amounts of marginal utility then the consumer will buy additional units of a product only if its price
Blank
______.

BlackTom题目解析

Question

If successive units of a good yield smaller and smaller amounts of marginal utility then the consumer will buy additional units of a product only if its price 
Blank
______.

BlackTom题目解析

BlackTom AI · Accepted Answer

The question deals with the idea that marginal utility from each additional unit of a good decreases as you consume more, and it asks under what price condition the consumer would still buy more units.
Option 1: 'falls' — This is the correct intuition. When marginal utility from extra units is declining, a consumer will continue to buy more only if the price falls enough to make the additional MU gained from the next unit worthwhile in terms of total satisfaction per dollar spent. In other words, a lower price can offset the smaller MU.
Option 2: 'rises' — If the price rises, each additional unit becomes more expensive relative to the small extra satisfaction it provides, so the consumer would be less inclined to purchase more. Higher prices counteract the motivation provided by any diminishing MU, so this option makes less sense.
Option 3: 'is inelastic' — Elasticity describes how quantity demanded responds to price changes, not the cognitive reason tied to diminishing marginal utility. While elasticity can influence buying decisions, it doesn’t directly address the conditionality described in the question, which hinges on price relative to marginal utility.
Option 4: 'is elastic' — Similarly, labeling demand as elastic emphasizes a large change in quantity with a price change, but it still fails to capture the specific rule that continuing to buy requires a price fall to compensate for decreasing marginal utility. This option misframes the core relationship between MU and price in this context.

If successive units of a good yield smaller and smaller amounts of marginal utility then the consumer will buy additional units of a product only if its price Blank ______. BlackTom题目解析

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