Question

How is law of demand related to law of diminishing marginal utility?

Answer 1

The first explanation of downward sloping demand curve rests on the notion of utility. We consume goods and services because they give us utility. The law of diminishing marginal utility states that with an increase in the units of a commodity consumed, every additional unit of the commodity gives less satisfaction to the consumer. In other words, marginal utility of the commodity falls with an increase in its consumption.