Marginal Utility Analysis Predicts a Downward-Sloping Demand Curve for Good

question 79

Multiple Choice

Marginal utility analysis predicts a downward-sloping demand curve for good X because

• A)as PX falls,the ratio MUX/PX becomes smaller,causing the consumer to purchase more of good X.
• B)as PX rises,the consumer increases purchases of X such that MUX/PX is equal to MU/P for all other products.
• C)utility-maximizing consumers equate marginal utility received for each product consumed.
• D)all demand curves are downward sloping,regardless of the behaviour of consumers.
• E)as PX falls,the consumer increases purchases of X until MUX/PX is equal to MU/P for all other products.

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