Law of Diminishing Marginal Utility

Law of Diminishing Marginal Utility Name Institution Law of Diminishing Marginal Utility In economics, the law states that when the consumption of a product by a person increases if the use of other products is kept constant then the marginal utility declines. The marginal utility is what the person gets when they consume each additional component of that particular product. The best example of the law is how it is applied in restaurants that operate the buffet style of giving dishes. The restaurants know that the all a person can eat policy entices more of the customers as it offers a wide selection of dishes (Rios, McConnell & Brue, 2013). The restaurants have the knowledge that with each additional plate served to the customer; it will lower the utility than the previous plate of food. In this respect, the utility is the satisfaction that a person gets from consuming a particular product (Kauder, 2015). ...