NABTEB Economics 2023 Objective — Question 13
Question 13 of 50 from the National Business and Technical Examinations Board (NABTEB) Economics 2023 Objective paper, with the correct answer and a full explanation.
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When the marginal utility from the consumption of commodity X (MUx) is greater than the price of commodity X (Px), a rational consumer should A. Consume more of commodity X B. reduce consumption of commodity X C. consume the same quantity of commodity X D. strive to remain in disequilibrium
- A. Consume more of commodity XCorrect
- B. reduce consumption of commodity X
- C. consume the same quantity of commodity X
- D. strive to remain in disequilibrium
Explanation
A rational consumer keeps consuming more of a good as long as marginal utility exceeds price, continuing until MU = P (utility maximisation).
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