If the Price of a Product Rises, Consumers Buy Less

question 94

Multiple Choice

If the price of a product rises, consumers buy less of the good because the:

• A) MU/P of the good falls below the MU/P of other goods.
• B) MU/P of the good rises above the MU/P of other goods.
• C) marginal utility of the good rises.
• D) total utility of the good diminishes.

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Definitions:

Personal Costs

Expenses directly paid by an individual, often including living expenses, tuition, and personal bills.

Economic Activity

Every activity related to creating, distributing, and using products and services within an economic system.

Adam Smith

An 18th-century Scottish economist and philosopher, widely considered the father of modern economics, best known for his works on the principles of free market and the "invisible hand" concept.

Own Interests

Actions or decisions driven by personal benefits or gains, often discussed in the context of economic behavior or political decision-making.