Answer to Question #277506 in Microeconomics for Simi

Question

1. With aid of diagrams derive the demand curve of the consumer preference from the total utility graph.
2. Using graphical approach distinguish between Diminishing utility, Marginal Benefits and marginal Cost

Answer 1

b) Marginal benefits are the maximum amount a consumer will pay for an additional good or service, they generally decreases as consumption increases.

The marginal cost, this is the change in cost that comes from making more of something. The purpose of analyzing marginal cost is to determine at what point an organization can achieve economies of scale.

Diminishin utility says that the marginal utility from each additional unit declines as consumption increases.