If a Product Has a Diminishing, but Positive, Marginal Utility

question 221

Multiple Choice

If a product has a diminishing, but positive, marginal utility, then

• A)total utility decreases at an increasing rate.
• B)total utility will become negative.
• C)total utility increases at a diminishing rate.
• D)total utility decreases at a diminishing rate.

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Definitions:

Personal Property

Personal property encompasses any movable property that is not attached to or associated with real estate, such as vehicles, furniture, and electronic devices.

Units-of-Activity

A depreciation method that allocates an asset's cost based on its usage, activities, or units of production rather than the passage of time.

Double-Declining-Balance

A method of accelerated depreciation which doubles the rate at which an asset depreciates compared to the straight-line depreciation method.

Depreciation

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value over time due to usage, wear and tear, or obsolescence.