The statement "as more of a good is consumed, the utility a person derives from each additional unit diminishes" is known as the:
A) water and diamond paradox.
B) law of diminishing marginal utility.
C) law of total utility.
D) marginal-utility-to-price ratio equalization rule.
E) law of diminishing demand.

Question

Quizplus · Accepted Answer

The statement is describing the law of diminishing marginal utility, which states that as a person consumes more of a good, the satisfaction gained from each additional unit consumed decreases.

The Statement "As More of a Good Is Consumed, the Utility