Question : Assertion (A): The demand curve shows the inverse relationship between the own price of a good and its quantity demanded.
Reason (R): Law of diminishing marginal utility advocates that consumer gets lesser satisfaction for each additional unit consumed
Option 1: Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation
of Assertion (A)
Option 2: Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation
of Assertion (A)
Option 3: Assertion (A) is true but Reason (R) is False
Option 4: Assertion (A) is False but Reason (R) is True
Correct Answer:
Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation
of Assertion (A)
Solution :
The rule of demand—the inverse relationship between prices and quantity demanded—is once again demonstrated by the downward slope of the demand curve. Each product will have a somewhat distinct demand curve.
According to the law of declining marginal utility, when consumption rises, the marginal utility gained from each extra unit decreases, all other things being equal.
Hence option a is the correct answer.
