The law of diminishing marginal utility helps to explain why supply curves are generally upward sloping.

Question

Quizplus · Accepted Answer

The law of diminishing marginal utility explains why demand curves are downward sloping, as it states that the additional satisfaction (utility) a consumer gets from consuming one more unit of a good or service decreases as the quantity consumed increases. It does not directly explain why supply curves are generally upward sloping; supply curves are upward sloping due to increasing marginal costs of production.

The Law of Diminishing Marginal Utility Helps to Explain Why