Question 17 4 pts The prices that people are willing to pay

Question 17 4 pts The prices that people are willing to pay for goods and services mostly depend on: the cost of producing the goods and services. whether the goods are legal, since the laws affect the position of both supply and demand curves. the total utility derived from the goods and services. the availability of raw materials for producing the goods and services. the marginal utility derived from the goods and services.

Solution

17.

When the consumer is willing to purchase any goods and services, then they compare money spent on it and marginal utility derived from using this goods and services.

If marginal utility is greater than price they will purchase this goods and services.

Hence option fifth is the correct answer.

18.

When the budget line of two goods are tangent to the highest achievable indifference curve, then this situation is known as consumer equilibrium because consumer is maximising his utility by consuming this bundle.

Hence option first is the correct answer.

19.

No, it is false, because as the price of any good increases, then the consumer get less additional utility by using it. Hence the marginal decreases.

Hence option false is the correct answer.