Elucidate the law of diminishing marginal utility with diagram.
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Law of diminishing marginal utility :
Law of diminishing marginal utility states that as a consumer consumes more and of a commodity, the marginal utility obtained from an additional unit of it goes on diminishing, other things remaining the same.
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Refer the attachment for diagram.
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The schedule and diagram show that as the consumer consumes more and more of a commodity, the marginal utility goes on diminishing.
The law of diminishing marginal utility is all about the law of economics which states that as the consumption of product increases, there is a decline in the marginal utility.
It takes place by keeping consumption of other products at a constant rate.
The decline is derived from consumption of each additional unit of that particular product.
The best example is all about the consumption of candy to satisfy the sweet tooth.