Question

Assuming that diminishing marginal utility applies to both goods, if a consumer buys more plastic bins and fewer door hooks, the _____ utility of plastic bins will _____, and the _____ utility of door hooks will _____.

A. marginal; fall; marginal; fall

B. marginal; rise; total; rise

C. marginal; fall; marginal; rise

D. total; fall; marginal; rise

Answer 1

The correct option is C). marginal; fall; marginal; rise

Assuming that diminishing marginal utility applies to both goods, if a consumer buys more plastic bins and fewer door hooks, the marginal utility of plastic bins will fall, and the marginal utility of door hooks will rise.

Marginal utility, in economics, the additional satisfaction or benefit (utility) that a consumer derives from buying an additional unit of a commodity or service. The concept implies that the utility or benefit to a consumer of an additional unit of a product is inversely related to the number of units of that product he already owns.