When Marginal Utility = 0, Total Utility is. A. Maximum B. Laws of return C. Minimum D. None of the above

To answer the question regarding marginal utility and total utility, we need to understand the concepts involved.

Understanding Marginal Utility

1. Definition of Marginal Utility: Marginal Utility refers to the additional satisfaction or utility that a consumer derives from consuming one more unit of a good or service.
2. Relationship with Total Utility: Total Utility is the overall satisfaction gained from consuming a certain quantity of a good or service.

Analysis of the Situation

1. When Marginal Utility equals zero, it means that consuming an additional unit of the good does not provide any additional satisfaction. Therefore, the total utility has reached its peak value.
2. At this point, if you were to consume more, the total utility would not increase, and it could start to decline if further consumption leads to dissatisfaction.

Conclusion

• When Marginal Utility = 0, it indicates that Total Utility is at its maximum, indicating that any additional consumption would not add to the satisfaction experienced.

Final Answer

A. Maximum