For MOST families,the marginal utility of income is:
A)increasing.
B)constant.
C)diminishing.
D)unknown;the answer depends on the value of income.

Question

Quizplus · Accepted Answer

The law of diminishing marginal utility states that as one consumes more of a good or service, the additional satisfaction gained from each additional unit will eventually decrease. This also applies to income, as the more income a family earns, the less utility (or satisfaction) they will derive from each additional dollar earned. Therefore, for MOST families, the marginal utility of income is diminishing.

For MOST Families,the Marginal Utility of Income Is