The Relation Between Total Utility and Marginal Utility

The relation between total utility and marginal utility define with the help of the following table.

This table shows that marginal utility has 3 forms, they are positive, negative and zero. the marginal utility is positive when the consumption of the marginal units gives the same satisfaction, it is negative when the consumption of the marginal unit causes some dissatisfaction and zero when the marginal unit does not yield any utility.

When a consumer consumed first, second and third bread, he gets positive marginal utility as 6,4 and 2 respectively, there marginal utility is decreasing and the total utility is increasing at decreasing rate. When the consumer consumed 4th units he gets no utility or zero utility and total utility remaining constant. It is the maximum total utility when 5th units are consumed, marginal utility becomes negative and total utility state be declined.

The relation between total utility and marginal utility can be explained by the following figure:

The above figure shows that when the consumer consumed the first (1st) units of bread, he gets 6 units of utility which is shown by point A. Similarly when the consumer consumed the second (2nd) and third (3rd) units of bread marginal utility decreasing and total utility increases in the decreasing rate, at the fourth (4th) unit’s marginal utility is zero. In the situation total utility is maximum. After the fourth unit’s marginal utility curve stops downwards. It means that fifth (5th) units yelled negative marginal utility. In the situation, the total utility begins to diminish in short.

• When the marginal utility is positive, total utility will be increasing.
• When the marginal utility is zero, the total utility will be maximum.
•  When marginal utility is negative, total utility will be decreasing.