Which of the Following Statements Is True with Respect to Utility

question 93

Multiple Choice

Which of the following statements is true with respect to utility theory?

• A)The less you have of any one good, the less you would be willing to pay for one more unit of it.
• B)The less you have of any one good, the more you would be willing to pay for one more unit of it.
• C)The amount you have of any one good does not influence the price you would be willing to pay for it, but it does affect the marginal utility received from consuming a particular unit.
• D)The higher the marginal utility received from consuming good X, the lower the marginal utility received from consuming good Y.

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Definitions:

Budget Line

A graphical representation of all possible combinations of two goods that a consumer can afford given their income and the prices of the goods.

Satisfaction

The state of feeling pleased or content with something.

Indifference Curve

A graphical representation showing combinations of goods or services that provide the same level of utility or satisfaction to a consumer.

Budget Lines

A graphical representation of all possible combinations of two goods that can be purchased with a fixed income.