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Question 15 of 41

Q.Marginal Utility is measured by using the formula of :

(a) TUn + TUn+1
(b) TUn - TUn-1
(c) TUn - TUn+1
(d) TUn + TUn-1
Puducherry TnboardTamil Nadu HSC First Year (DGE) Commerce Board 2020MCQ· 1mImportance★★★★★
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The correct formula is (b) MU = TUn - TUn-1.

Marginal Utility (MU) is the extra satisfaction a consumer gets from consuming one additional unit of a commodity. If TUn is the total utility from consuming n units and TUn-1 is the total utility from consuming (n-1) units, then the utility added by the nth unit is:

MU of nth unit = TUn - TUn-1

For example, if total utility from 3 units is 30 and from 2 units is 24, the marginal utility of the 3rd unit = 30 - 24 = 6 utils.

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