The principle of diminishing marginal utility says that:
A. as more of a good or service is consumed, demand decreases.
B. as more of a good or service is consumed, the price will rise.
C. the marginal utility of additional units consumed decreases.
D. an increase in income causes demand to increase.
Answer: C
You might also like to view...
An increase in the expected rate of inflation will:
A. lower the demand for real balances because the real interest rate will rise. B. lower demand for real balances because the nominal interest rate will rise. C. increase the demand for real balances because the real interest rate will fall. D. increase the demand for real balances because the nominal interest rate will rise.
According to the quantity theory of money, increasing the money supply:
A. leads to inflation. B. causes production to increase. C. leads to decreased spending. D. causes each dollar to be spent less often.