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

question 64

Multiple Choice

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

• A)as P_X falls,the ratio MU_X/P_X becomes smaller,causing the consumer to purchase more of good X.
• B)as P_X rises,the consumer increases purchases of X such that MU_X/P_X 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 P_X falls,the consumer increases purchases of X until MU_X/P_X is equal to MU/P for all other products.

---

Definitions:

Dehabilitating Illness

A chronic illness or condition that significantly impairs physical or mental ability and quality of life.

Psychological Causes

Factors related to emotions, thoughts, behaviors, and interpersonal processes that can lead to mental disorders or psychological distress.

Conversion Disorder

A mental condition where patients experience neurological symptoms, such as blindness or paralysis, without a physical cause, often as a response to psychological stress.

Medical Diseases

Conditions that affect the body's structures or functions and are typically characterized by specific signs and symptoms, often with a known cause.