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Question
Which Law states that: “When a consumer consumes more and more units of a product, the utility derived from each additional unit decreases”?
Options
Law of Equi-Marginal Utility
Law of Ordinal Utility
Law of Cardinal Utility
Law of Diminishing Marginal Utility
MCQ
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Solution
Law of Diminishing Marginal Utility
Explanation:
The Law of Diminishing Marginal Utility says that marginal satisfaction decreases with successive units consumed. The other options do not state this principle.
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