law of diminishing marginal utility

LAW OF DIMINISHING MARGINAL UTILITY

     Satisfaction of human wants follows some very important laws and one then is the law of diminishing marginal utility.  The law refers to the common experience of every consumer.  Suppose a person is another is the addition satisfaction will go on decreasing with every successive leaf till it drops to zero and and if the consumer is forced to eat more, the satisfaction may become negative or the utility may change to dis utility

Definition:

The additional benefit which a person derives from a given increase of his stock

of a tiling from diminishing with every increase is stock a that the already has, by

marshall .

Law of diminishing marginal utility (DMU):

     It based on the concept of law of diminishing marginal utility (DMU)

a) Utility:

• It means expected satisfaction to a consumer when he is Utility to spend money on a stock of community which has the capacity to satisfy his wants.
• utility is essentially a subjective concept depending upon, the extensively of consumers , desire (or) mont for that commodity at that time
• According to Marshall money should be used to measure utility.

b) Total utility:

• It is the aggregate of the utility that consumers derive from, that consumption of s certain amount of a commodity Tun=Mu1+Mu2+.......mun

C) marginal utility (MU)

• It is the addition made to the utility as the consumption is increased by one mare unit of the commodity. 
•     Mun= Tun - Tu(n-1)

d) The law of diminishing marginal utility.

• The LDMU states that as the consumer has more and mare units of a commodity.  
• According to thing law Tu increasing but at a decreasing rate and Mu falls.

e) The utility schedule and utility cube

• LDMU is numerically illustrated in terms of utility schedule.
• The shedule shows the Tv and Mu derived by a consumer as the more and more units of good.