Explain the condition of consumer's equilibrium with the help of utility analysis.

Explanation

Consumer's equilibrium will be attained at a point where marginal utility of a commodity is equal to its price. However, MU is expressed in terms of utils and price is expressed in money form. Therefore, equality of MU in utils and price cannot be the basis of consumer's equilibrium. Hence, marginal utility also needs to be expressed in money form.
Marginal utility in money form can be obtained by dividing it (MU) by marginal utility of one rupee. Marginal utility of 1 is the extra utility when an additional rupee is spent on other available goods in general. Suppose that for an addition rupee we get two units of some other commodity, then marginal utility of rupee, we can find out marginal of a commodity in Marginal Utility in Money terms = `("Marginal Utility (in units)")/("Marginal Utility of Rs 1")`