The law of diminishing marginal utility states:
ECONOMICS
JAMB 2017
The law of diminishing marginal utility states:
- A. The supply curve slopes downward
- B. Your utility grows at a slower and slower rate as you consume more and more unit of a good.
- C. The elasticity of demand is infinite
- D. None of the above
Correct Answer: B. Your utility grows at a slower and slower rate as you consume more and more unit of a good.
Explanation
The law of diminishing marginal utility states that the Satisfaction derived from consuming successive units of a commodity will diminish as the total consumption of the commodity increases. In other words, the total utility increases as more of a commodity is consumed but increases at a diminishing rate.
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