The Law of Diminishing Marginal Utility
Register to order a custom paper Register
The utility theory is one of the most common concepts in economics. It describes how individuals make certain decisions, for instance, when to buy a particular item. According to the law of diminishing marginal utility, ceteris paribus, as consumption increases, the marginal utility one obtains from each additional unit decreases. In economics, the term utility is used to mean happiness or satisfaction.
Share