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In: Economics

Would you expect Marginal Utility to rise or fall with additional consumption of a good? Why?...

Would you expect Marginal Utility to rise or fall with additional consumption of a good? Why? Provide one or two examples. Looking for a post of 150+ words

Solutions

Expert Solution

The marginal utlity of the goods will decrease as we increase the consumption of the goods in the market. for example, We eat a pizza and get a utility of 100, now we are feeling slightly full , the second pizza will given up a utility of 120 but the here we are completely full and the third pizza might be really dificult to eat and give a utility of only 50.

Similarly, for soda or ice cream or any other goods that we are looking to consume, after a point the extra utility we get from each additional unit will fall.


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