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Which of the following describes a situation in which there would be decreasing marginal utility?

  • Question 7a of 10 - Utility

  • Maximum Attempts: 1
  • Question Type: Multiple Choice
  • Maximum Score: 2
  • Question: Which of the following describes a situation in which there would be decreasing marginal utility?
  • Answers:
  1. Buying normal goods as substitutes for inferior goods.
  2. Buying luxury items that you cannot afford.
  3. Buying food in bulk to save money in the long run.
  4. Buying a new car when you already have two cars.

The correct answer is: Buying a new car when you already have two cars. The utility of a car decreases with the addition of each new one.

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