As long as the marginal utility of each extra unit is greater than its price, a buyer will purchase things.As soon as the price surpasses the marginal utility, a consumer quits consuming new things.
What happens when MU price is greater?
- As long as the marginal utility of each extra unit is greater than its price, a buyer will purchase things.As soon as the price surpasses the marginal utility, a consumer quits consuming new things.
- When the elasticity number exceeds 1.0, it indicates that the change in the price of the good or service has an outsized impact on consumer demand.A value less than 1.0 denotes that the demand is inelastic, or somewhat insensitive to price. .
- A demand that is elastic experiences a significant shift in quantity demanded as a result of a price adjustment.When the amount sought changes little as a result of a price adjustment, the demand is said to be inelastic.
- High elasticity is a question with a single element.It has more elasticity if any one issue can make consumers buy less of the goods.Low elasticity is a concern of net-factor.This is a low elasticity product if, once all is said and done, no demand factor will significantly influence consumption.
- By dividing marginal utility in utils by marginal utility of one rupee, one can determine marginal utility in terms of money.When MUx exceeds price (MUx > Px), the consumer continues to purchase the good since she is paying less for each incremental level of satisfaction she receives.
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