What does the law of diminishing utility state?

Show Answers

The initial unit provides the highest satisfactionMarginal utility grows with each additional unit consumedMarginal product decreases as consumption increasesTotal satisfaction increases but at a decreasing pace with more consumption

Explanation

The law of diminishing utility explains that while total utility increases as more units are consumed, it does so at a progressively slower rate. This means each additional unit adds less satisfaction than the previous one.