ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -This event is known as the Law of Diminishing Marginal Utility. According to this law, a commodity’s marginal utility decreases with each successive consumption of its consecutive units. In simple words, consumption of the first unit of the commodity is higher than the consumption of the fourth unit of the commodity.

Detailed explanation-2: -Diminishing marginal utility refers to the phenomenon that each additional unit of gain leads to an ever-smaller increase in subjective value. For example, three bites of candy are better than two bites, but the twentieth bite does not add much to the experience beyond the nineteenth (and could even make it worse).

Detailed explanation-3: -Farming is the classic example of this law. Farmers usually have a finite acreage of land on which they can add an infinite number of laborers to increase crop yields. However, there is a point where an additional worker produces less of an increase in crop yields than the last worker added.

Detailed explanation-4: -The law of diminishing marginal utility holds that as we consume more of an item, the amount of satisfaction produced by each additional unit of that good declines. The change in utility gained from utilizing an additional unit of a product is known as marginal utility.

Detailed explanation-5: -The law of diminishing marginal utility states that as more of the good is consumed, the additional satisfaction from another bite will eventually decline. The marginal utility is the satisfaction gained from each additional bite.