Diminishing marginal utility

Law of diminishing marginal utility
Definition: The more a consumer has of a given commodity the smaller the satisfaction gained from consuming each extra unit.
Related glossary term: ...

Diminishing marginal utility The principle that as more of any good or service is consumed, its extra benefit declines.

Diminishing marginal utility - 1. as more units of a good are consumed, additional units will provide less additional satisfaction than previous units. Or 2. where each additional dollar of income earned yield s less additional utility.

diminishing marginal utility the decline in additional utility from consumption of an additional unit of a good as more and more of the good is consumed. (5) ...

LAW OF DIMINISHING MARGINAL UTILITY: The principle stating that as more of a good is consumed, eventually each additional unit of the good provides less additional utility--that is, marginal utility decreases.

Law Of Diminishing Marginal Utility
A law of economics stating that as a person increases consumption of a product - while keeping consumption of other products constant - there is a decline in the marginal utility that person derives from consuming ...

See also: Law of Diminishing Marginal Utility, Marginal Utility, Total Utility, Utility
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It assumes that utility is cardinal and that additional utils provide smaller and smaller increases in utility (diminishing marginal utility).

Dictionary Term
law of diminishing marginal utility
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The theory shows that, if an agent's utility function features diminishing marginal utility of money, then that agent will be risk averse. We can quantify the degree of that risk aversion for particular risky assets.

However, the more they have, the less difference an additional unit of utility will make - there is diminishing MARGINAL utility.

" The concept of precisely measurable utility was at the heart of the derivation of the classical theory of demand, in the form of the law of diminishing marginal utility.

Higher taxes really would not harm the well-to-do, he says, because money and material possessions are subject to diminishing marginal utility. If such claims have a familiar ring, it is because Galbraith made the same points fifty years ago.

See also: Marginal utility, Tip, Feedback, Perfect competition, Demand curve