If the marginal utility of commodity is equal to its price, then

  • A the consumer is in equilibrium
  • B more of the commodity can be consumed
  • C total utility is also equal to its price
  • D the market is not in equilibrium
jamb 2022economics

The correct answer is A. the consumer is in equilibrium

A consumer is in equilibrium when the marginal utility of a commodity is equal to its price if only one commodity is consumed i.e MU x=Px where :

MU = Marginal utility

P= Price of the commodity

x = The commodity

Previous question Next question