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      Question

      The law of diminishing marginal utility states that as

      a consumer consumes more of a good:  
      A The total utility increases indefinitely Correct Answer Incorrect Answer
      B The marginal utility increases Correct Answer Incorrect Answer
      C The marginal utility decreases Correct Answer Incorrect Answer
      D The price of the good rises Correct Answer Incorrect Answer
      E The consumer’s income decreases Correct Answer Incorrect Answer

      Solution

      • Marginal utility is the additional satisfaction gained from consuming one more unit of a good. 
      • According to the law of diminishing marginal utility , as consumption increases , the additional satisfaction from each extra unit declines . 

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