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Home Questions TDSMBW43EE
Target Exam

CUET

Subject

Economics

Chapter

Micro Economics: Theory of Consumer behaviour

Question:

What will be the value of Marginal utility of the 4th unit.

Units consumed

Total Utility derived (utils)

1

10

2

8

3

5

4

2
Options:

8 utils

-3 utils

3 utils

25 utils

Correct Answer:

-3 utils

Explanation:

The correct answer is Option (2) → -3 utils

Marginal Utility (MU) is the change in total utility when one more unit is consumed. It is calculated as:

Marginal Utility (MU) = Total Utility of n units - Total Utility of (n-1) units

For the 4th unit:

  • TU at 4 units = 2 utils

  • TU at 3 units = 5 utils

MU of 4th unit  = (Total Utility of 4th unit) - (Total Utility of 3rd unit)
                      =  2−5
                      =−3 utils

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