A fall in marginal utility reflects:
A) the water and diamond paradox.
B) the law of supply.
C) the principle of diminishing marginal utility.
D) decreased consumption of a good.
E) the fact that total utility must be declining.

Question

Quizplus · Accepted Answer

The principle of diminishing marginal utility states that as a consumer consumes more units of a good or service, the satisfaction that they derive from each additional unit will eventually decrease. This is reflected in a fall in marginal utility. Therefore, choice C is the best answer.

A Fall in Marginal Utility Reflects