A student enters a McDonald's fast-food restaurant. He orders the first Big Mac. He consumes it within 3 minutes. He then orders a second Big Mac and consumes it in 10 minutes. He eats only half of the third one in 18 minutes and throws away the rest. The store manager offers him the fourth for free. The student says: "No thanks." For the student described above, we can say that

Question

Quizplus · Accepted Answer

The law of diminishing marginal utility states that as a consumer consumes more and more of a good, the satisfaction derived from each additional unit of the good decreases. In this case, the student's satisfaction from consuming the Big Macs would have decreased with each additional one he consumed, suggesting that diminishing marginal utility began as soon as he had eaten the first one. The fact that he only ate half of the third one and refused the fourth one further supports this idea.

A Student Enters a McDonald's Fast-Food Restaurant