The law of diminishing marginal utility helps explain:
A) why most individual demand curves are straight lines.
B) why most supply curves slope upward.
C) why most individual demand curves slope downward.
D) why marginal utility falls when total utility falls.

Question

Quizplus · Accepted Answer

The law of diminishing marginal utility states that as you consume more of a good, the additional utility (or satisfaction) you receive from consuming each additional unit decreases. This helps explain why most individual demand curves slope downward because as the price of a good decreases, consumers will continue to purchase more of it until the marginal utility of consuming one more unit is equal to the price they must pay for it.

The Law of Diminishing Marginal Utility Helps Explain