Marginal utility analysis predicts a downward-sloping demand curve for good X because

Question

Accepted Answer

as Px falls, the consumer increases purchases of X such that MUx/Px is equal to MU/P for all other products.

Answer

as Px falls, the ratio MUx/Px becomes smaller, causing the consumer to purchase more of good X.

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as Px rises, the consumer increases purchases of X such that MUx/Px is equal to MU/P for all other products.

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utility-maximizing consumers equate marginal utility received for each product consumed.

Answer

all demand curves are downward sloping, regardless of the behaviour of consumers.

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