Question

Is there Diminishing Marginal Utilty for all products? What happens to people who consume products with increasing marginal utility?

Answer 1

The law of marginal utility theory states that by consuming additional units of the commodity the satisfaction derived from the additional units goes on diminishes the theory built on the following assumption.

• The utility is measurable
• The utility is from additional units decreases
• There exists continuous consumption of the goods

The above assumptions are the fundamental theme of the theory.

The utility of the certain goods is the exception for the theory example. The consumption of the Alcohol the consumption fo the additional unit units gives increasing utility than the diminishing utility.