Asked by jamie sherwood on Jun 18, 2024
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The law of diminishing marginal utility states that:
A) total utility is maximized when consumers obtain the same amount of utility per unit of each product consumed.
B) beyond some point,additional units of a product will yield less and less extra satisfaction to a consumer.
C) price must be lowered to induce firms to supply more of a product.
D) it will take larger and larger amounts of resources beyond some point to produce successive units of a product.
Diminishing Marginal Utility
A common economic concept stating that as a person consumes more of a product, the satisfaction (utility) gained from each additional unit decreases.
Total Utility
It is the total satisfaction or benefit that a consumer derives from consuming a certain quantity of goods or services.
Additional Units
Refers to extra quantities or increments of a product or service that are made available or consumed.
- Elucidate the principle that underlines diminishing marginal utility.
Verified Answer
Learning Objectives
- Elucidate the principle that underlines diminishing marginal utility.
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