Question

In one or two sentences, describe why a consumer who consumes too much X relative to...

In one or two sentences, describe why a consumer who consumes too much X relative to the utility maximizing amount of the good would experience an increase in utility from substituting away from X for the other good she might buy.

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Answer #1

The situation in this question represents the diminishing utility from good X.

As per the law of the diminishing marginal utility , when one good say X is consumed on continuous basis , beyond a point the incremental utility derived from that good will start decreasing.


Therefore it is better to switch to alternative good to ensure that the overall utility from the consumption of goods is high.


Basis this law in the given question she might move from good X to alternative good to keep the marginal utility from consumption high.

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