Which principle states that the added satisfaction from each extra unit declines as more units are consumed?

Which principle states that the added satisfaction from each extra unit declines as more units are consumed?

• A. Law of demand
• B. Marginal utility
• C. Total utility
• D. Diminishing marginal utility

Answer: (D)

This principle describes how the added satisfaction from each extra unit declines as more of the good is consumed. Each additional unit still adds some happiness (marginal utility), but the amount of extra satisfaction tends to shrink with every new unit. For example, the first slice of pizza brings a lot of satisfaction, the second slice adds less, and after several slices, each new slice adds even less and may eventually taste less appealing. Total utility is the overall satisfaction from all units combined, which can rise as you eat more but at a slower pace. The law of demand is about how price influences how much people buy, not specifically about how satisfaction changes with each extra unit.

This principle describes how the added satisfaction from each extra unit declines as more of the good is consumed. Each additional unit still adds some happiness (marginal utility), but the amount of extra satisfaction tends to shrink with every new unit. For example, the first slice of pizza brings a lot of satisfaction, the second slice adds less, and after several slices, each new slice adds even less and may eventually taste less appealing. Total utility is the overall satisfaction from all units combined, which can rise as you eat more but at a slower pace. The law of demand is about how price influences how much people buy, not specifically about how satisfaction changes with each extra unit.