What does marginal utility do when price of a product rises?

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1289059

2026-07-13 19:25

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When the price of a product rises, the marginal utility of that product typically decreases for consumers. This is because the higher price makes the product less accessible, leading consumers to evaluate its additional satisfaction against other goods. As a result, consumers may choose to purchase less of the product or seek alternatives that provide better utility for their budget. This reflects the principle of diminishing marginal utility, where the satisfaction gained from consuming additional units of a good decreases as consumption increases.

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