Total utility is maximum when marginal utility is: MCQ with Answer and Explanation

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Total utility is maximum when marginal utility is:

A. negative

B. zero

C. maximum

D. equal to average utility

Answer: Option B

Solution (By JKSSB Mock Tests)

Total utility reaches its maximum when marginal utility is zero; beyond this point, marginal utility becomes negative and total utility falls.

This question belongs to: Economy GK Economy Set 1

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Question #1

The law of variable proportions is associated with the:

A. long run

B. all time periods equally

C. very long run

D. short run

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Correct Answer: Option D

Explanation:
The law of variable proportions operates in the short run when at least one factor is fixed.

This question belongs to: Economy GK Economy Set 1

Question #2

The Goods and Services Tax Council is chaired by:

A. Chief Economic Adviser

B. RBI Governor

C. Union Finance Minister

D. Prime Minister

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Correct Answer: Option C

Explanation:
The GST Council is chaired by the Union Finance Minister.

This question belongs to: Economy GK Economy Set 1

Question #3

Which of the following is an example of a negative externality?

A. Education

B. Pollution from industrial activity

C. Research and development

D. Vaccination

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Correct Answer: Option B

Explanation:
A negative externality imposes costs on third parties. Industrial pollution harms the environment and health of people who are not parties to the production decision.

This question belongs to: Economy GK Economy Set 1

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