Economics (AS & A Level) · May / June 2026 · Paper 31 · Question 6

Marginal utility theory measures consumer satisfaction and concludes that the value of marginal utility a consumer places on a good will determine the price they are willing to pay for that good. The price of a bottle of water, which is vital for human survival, is less than the price of luxuries, such as designer clothing. Which statement is least likely to explain this?

1. Adifferent consumers have different marginal utilities for the same good
2. Bmoney does not measure utility accurately
3. Cprice is better at measuring the value of exchange than the value of satisfaction
4. Dprice is determined by both marginal utility and marginal cost

As printed in the paper