Marginal utility theory concludes that a decrease in the price of a good increases the quantity demanded and
A) increases the demand for substitutes.
B) decreases the demand for complements.
C) increases the total expenditure on the good.
D) increases total utility.

Question

Quizplus · Accepted Answer

A decrease in the price of a good increases the quantity demanded, leading to higher consumption, which increases total utility as consumers derive more satisfaction from consuming more of the good.

Marginal Utility Theory Concludes That a Decrease in the Price