Utility Quiz by Shubhrata Shrestha | Jun 24, 2025 | 0 comments Utility Quiz 1. What happens to total utility as more units of a good are consumed? A) It decreases steadily B) It increases and then drops C) It increases at a decreasing rate D) It remains constant None 2. Marginal utility is defined as: A) Total satisfaction from all goods B) Cost per unit of good C) Additional satisfaction from one more unit D) Average utility per rupee None 3. The law of diminishing marginal utility explains why: A) Marginal utility increases with consumption B) The supply curve slopes upward C) The demand curve slopes downward D) Consumers buy unlimited goods None 4. According to the equi-marginal principle, utility is maximized when: A) Total utility = Marginal utility B) MU/P is equal across all goods C) All goods are priced equally D) Average utility is maximum None 5. What assumption is NOT made by marginal utility theory? A) Rational consumer B) Constant preferences C) Utility is ordinal D) Divisible goods None 6. If MUx/Px = 4 and MUy/Py = 6, what should the consumer do? A) Buy more of good X B) Buy more of good Y C) Reduce spending D) Keep consumption constant None 7. Which of the following leads to a downward-sloping demand curve? A) Law of Equi-Marginal Utility B) Increase in supply C) Diminishing marginal utility D) Constant total utility None 8. One criticism of marginal utility theory is that: A) It includes externalities B) It considers utility as ordinal C) It assumes utility is measurable in numbers D) It assumes fixed prices only None 9. Marginal Utility becomes zero when: A) TU stops increasing B) MU becomes negative C) Consumption stops D) Prices fall to zero None 10. A consumer maximizes satisfaction by choosing a combination of goods such that: A) TU is minimized B) MU = P C) MU/P is the highest D) MU/P is equal for all goods None Time's up Submit a Comment Cancel replyYour email address will not be published. Required fields are marked *Comment * Name * Email * Website Save my name, email, and website in this browser for the next time I comment. Δ
