Match List-I with List-II. (TU = total utility; the demand curve is \( d(p) = a - bp \).)
| List-I | List-II | ||
|---|---|---|---|
| (A) | Marginal utility of the nth unit | (I) | a |
| (B) | Demand at a price of zero | (II) | TUn – TUn–1 |
| (C) | Price at which demand becomes zero | (III) | b |
| (D) | Fall in demand for a unit rise in price | (IV) | \( \displaystyle\frac{a}{b} \) |
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → (A) - (II), (B) - (I), (C) - (IV), (D) - (III)
Marginal utility is the change in total utility from one more unit. On the linear demand curve d(p) = a − bp, a is the demand at zero price and b is the fall in demand per unit rise in price.
| List-I | List-II | Reason |
|---|---|---|
| (A) Marginal utility of the nth unit | (II) TUn – TUn–1 | The change in total utility when the nth unit is added. |
| (B) Demand at a price of zero | (I) a | Put p = 0: d(0) = a. |
| (C) Price at which demand becomes zero | (IV) \( \displaystyle\frac{a}{b} \) | Put a − bp = 0: p = a/b. |
| (D) Fall in demand for a unit rise in price | (III) b | The slope of the curve is −b. |
NCERT (2026-27): “Measures of Utility … Marginal Utility: Marginal utility (MU) is the change in total utility due to consumption of one additional unit of a commodity. For example, suppose 4 bananas give us 28 units of total utility and 5 bananas give us 30 units of total utility. … In general, MUn = TUn – TUn-1, where subscript n refers to the nth unit of the commodity …” “Linear Demand A linear demand curve can be written as d(p) = a – bp; … where a is the vertical intercept, –b is the slope of the demand curve. At price 0, the demand is a, and at price equal to a/b, the demand is 0. The slope of the demand curve measures the rate at which demand changes with respect to its price. For a unit increase in the price of the good, the demand falls by b units.” |