Detailed explanation and options for the selected question.
What is the “law of diminishing marginal utility”?
A.
Utility increases with each additional unit consumed
B.
Utility decreases as consumption of a good increases
C.
Total utility remains constant regardless of consumption
D.
Marginal utility is always equal to price
Explanation:
The law states that as consumption increases, the additional satisfaction (marginal utility) decreases. Utility does not always remain constant or equal to price.