Which of the following illustrates the law of diminishing marginal utility?
A)The marginal utility of Diane's second Coke is greater than the marginal utility of her third pretzel, other things constant.
B)The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third pretzel, other things constant.
C)The marginal utility of Diane's second Coke is greater than the marginal utility of her third Coke, other things constant.
D)The total utility of one Coke is greater than the total utility of two Cokes, other things constant.
E)The marginal utility of Diane's second Coke is greater than the marginal utility of Ken's third Coke, other things constant.

Question

Quizplus · Accepted Answer

The law of diminishing marginal utility states that as a consumer consumes more and more of a good, the marginal utility or satisfaction derived from each additional unit decreases. In this case, the marginal utility of Diane's second Coke is greater than her third Coke, indicating that she is getting less and less satisfaction from each additional unit consumed. Choices A and B compare different goods, while choice D compares the total utility of different quantities, rather than the marginal utility of each additional unit. Choice E compares Diane's utility to Ken's, which is not relevant to the law of diminishing marginal utility.

Which of the Following Illustrates the Law of Diminishing Marginal