"As consumption of a good increases, the extra satisfaction received from consuming an additional unit of the good decreases." This statement is known as the law of:
A) demand.
B) increasing costs.
C) diminishing marginal utility.
D) diminishing marginal returns.
E) total utility.

Question

Quizplus · Accepted Answer

The statement describes the law of diminishing marginal utility, which states that the additional satisfaction or utility gained from consuming each additional unit of a good or service decreases as the quantity consumed increases. This law is a fundamental principle of economics and is used to explain consumer behavior and demand curves.

"As Consumption of a Good Increases, the Extra Satisfaction Received