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Theory of consumer behaviour — Economics STD 11 Commerce — Question

CBSE BoardEnglish MediumSTD 11 CommerceEconomicsTheory of consumer behaviour1 Mark
MCQ
Which of the following is not correct about consumer equilibrium through utility analysis?
  • ✓
    Law of Marginal Utility does not operate.
  • B
    Remains constant.
  • C
    Consumer is rational.
  • D
    None of these
✓

Answer

Correct option: A.
Law of Marginal Utility does not operate.
Law of diminishing marginal utility operates which implies that marginal utility must decline as more of a commodity is consumed by consumer. So, the consumer compares its satisfaction with monetary payment for getting maximum satisfaction.

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