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Explain relationship between tu and mu …

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Explain relationship between tu and mu with the help of schedule and graph
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Yogita Ingle 3 years, 5 months ago

  • 1. TU increases with an increase in consumption of a commodity as long as MU is positive. In this phase, TU increases but a diminishing rate as MU from each successive unit tends to diminish.
  • 2. When TU reaches its maximum, MU becomes zero. TU stops rising at this stage. This point is known as a point of satiety.
  • 3. When consumption is increased beyond the point of satiety, TU starts falling as MU becomes negative.  
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