[amp_mcq option1=”Law of substitution” option2=”Gossen’s first law” option3=”Gossen’s second law” option4=”Law of indifference” correct=”option4″]<\/p>\n
The correct answer is D. Law of indifference.<\/p>\n
The law of equi-marginal utility states that a consumer will maximize utility by allocating their income in such a way that the marginal utility of each good consumed is equal.<\/p>\n
The law of substitution states that consumers will substitute one good for another as the relative prices of the goods change.<\/p>\n
Gossen’s first law states that the marginal utility of a good declines as the consumer consumes more of that good.<\/p>\n
Gossen’s second law states that consumers will allocate their time and resources in such a way that the marginal utility of each good consumed is equal to the marginal utility of each hour of leisure time.<\/p>\n
The law of indifference states that a consumer is indifferent between two bundles of goods if they provide the same level of utility.<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”Law of substitution” option2=”Gossen’s first law” option3=”Gossen’s second law” option4=”Law of indifference” correct=”option4″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-52374","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"\n