Question

2. Does the principle of decreasing marginal utility apply to this good or service? Have you

reached the point of decreasing marginal utility? Explain.

Answer 1

The "Law of Diminishing Marginal Utility" states that for any good or service, the marginal utility of that good or service decreases as the quantity of the good increases, ceteris paribus. In other words, total utility increases more and more slowly as the quantity consumed increases.