The Law Of Diminishing
Marginal Utility
The law states that as an extra unit of a commodity is consumed by an individual, the satisfaction gained from each unit will decrease.
Assumptions:
- The consumer’s taste and preferences remains same during the period of consumption
- The quality of the commodity remains the same
- It is assumed that the price of the commodity and the income of the consumer remains unchanged
For
example:
- When I got my first bike during my graduation, my satisfaction level was at peak but after my graduation was completed eventually my attachment towards my bike started decreasing.
- I was involved in an event management, me with my other two friends arrived early and we were busy organizing the event and the work was going fluently but as the time went by, other members of the event also arrived and there was chaos among us and eventually we got frustrated and the work was slowed down as compared to starting.
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