The consumer's demand curve slopes down and to the right because as price rises, the consumer gets
A) fewer units of marginal utility per dollar and makes fewer purchases.
B) more units of marginal utility per dollar and makes more purchases.
C) a higher total utility per unit as more units are purchased.
D) a lower total utility per unit as more units are purchased.

Question

Quizplus · Accepted Answer

The consumer's demand curve slopes downward because, as the price of a good increases, the marginal utility per dollar spent on that good decreases, leading consumers to buy less of it. This reflects the law of diminishing marginal utility, where the additional satisfaction (utility) gained from consuming an additional unit of a good decreases as more of that good is consumed.

The Consumer's Demand Curve Slopes Down and to the Right