Saturday, August 4, 2018

LAW OF DIMINISHING MARGINAL UTILITY

Law of diminishing marginal utility:
It meant that if consumption increases initially it increases in marginal utility that then there will be decreasing in marginal utility . It will happens when there is difference shown in utility by consumption of additional unit and consumption is in large quantities,time will be in short period.
Eg: imagine you have gone to one bakery start eating sweets at first you have consumed 5 sweets and you feel  tasty with satisfaction after that you take another 5 sweets then you feel very good with highly satisfaction after that again you consume another 5 sweets then you feel that good but it is little bit decreased one after that again you consumer 5 sweets then you feel that I am fully satisfaction I can't go further, it will be in short period of time.
So the more you consume your interest will be decreasing this is diminishing marginal utility.

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