15+ The Law Of Diminishing Marginal Utility Examples Pics. This concludes the explanation for the law of diminishing marginal utility. For instance, one can read off the graph that 3.5 plates of food give the consumer 27.5 units of utility.

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Graphical representation of the law of diminishing marginal utility. The law of diminishing marginal utility is a textbook example of something that sounds remarkably complicated to the untrained eye but is actually. Diminishing marginal returns occur when increasing production further results in lower levels of output.

According to the law of diminishing marginal returns, the farmer will get to a point where adding an extra bag at this point, the marginal utility of the chefs will decrease.

Suppose you are thirsty, and as you drink the first glass of water, keeping the consumption of all other commodities constant, you get the maximum satisfaction, and with each successive glass of water. The law is not applicable for situations that require a specific amount of a good or service to achieve a desired outcome. There is often something extra satisfying about obtaining or using more than one of a certain item, whether that item is a can of soda, a pair of jeans there are several types of marginal utility, including zero, positive, negative, increasing, and diminishing marginal utility. Ms x found six packets of chocolate lying in her refrigerator.