Total utility A. cannot decrease as a person consumes more and more of a good. B. has a constant rate of increase as a person consumes more and more of a good. C. is equal to the sum of the marginal utilities of all units consumed. D. is negative when marginal utility is declining.

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Business

Alicia Jenkins

10 February, 03:29

Total utility A. cannot decrease as a person consumes more and more of a good. B. has a constant rate of increase as a person consumes more and more of a good. C. is equal to the sum of the marginal utilities of all units consumed. D. is negative when marginal utility is declining.

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Maryjane Wagner · Answer 1

Answer: Option (C) is correct.

Explanation:

Correct option: is equal to the sum of the marginal utilities of all units consumed.

Total utility refers to the aggregate satisfaction that a person can get from consuming the units of goods and services. Each consumer can get different utilities from each unit or we can say that every unit gives him/her a different level of utility.

These individual utilities from units of the goods are known as marginal utility.

Marginal utility also refers to the utility that a consumer can get from an additional unit consumed.

So, total utility is simply the sum marginal utilities of all the units that a consumer consumed.