Johnny spends his Saturday doing a variety of activities. In the morning he exercises and does yard work. He reads in the afternoon and hosts a dinner party in the evening. Economists would say his choice to do a variety of activities instead of spending all of his time on one activity illustrates the concept of:

Question

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Johnny's choice to engage in a variety of activities instead of focusing on just one illustrates the concept of diminishing marginal utility. This economic principle suggests that as a person consumes more of a good or engages in an activity more frequently, the satisfaction (utility) gained from each additional unit of consumption or time spent decreases. By diversifying his activities, Johnny is maximizing his overall satisfaction throughout the day.

Johnny Spends His Saturday Doing a Variety of Activities