Economics

It is said that, “total utility of a commodity is maximum when its marginal utility is zero” explain the statement with the help of a diagram. Define price elasticity of …

Example and Explanation of Law of Equi-Marginal Utility The doctrine of equi-marginal utility can be explained by taking an example. Suppose a person has Tk. 5 with him whom he …

Definition and Statement of Law of Equi-Marginal Utility The law of equi-marginal utility is simply an extension of law of diminishing marginal utility to two or more than two commodities. …

Practical Importance of Law of diminishing marginal utility The law of diminishing marginal utility has great practical importance in economics. The law of demand, the theory of consumer’s surplus, and …

Limitation/Exception of Law of Diminishing Utility There are some exceptions or limitations of the law of diminishing utility. Case of intoxicants: Consumption of liquor defies the law for a short …

Assumptions of Law of Diminishing Marginal Utility The law of diminishing marginal utility is true under certain assumptions. These assumptions are as under: i) Rationality: In the cardinal utility analysis, …

Schedule of Law of Diminishing Marginal Utility Units Total Utility Marginal Utility 1st glass 2nd glass 3rd glass 4th glass 5th glass 6th glass 20 32 40 42 42 39 …

Explanation and example of law of diminishing marginal utility This law can be explained by taking a very simple example. Suppose a man is very thirsty. He goes to the …

Law of Diminishing Marginal Utility Definition and Statement of the Law The law of diminishing marginal utility describes a familiar and fundamental tendency of human behavior. The law of diminishing …

Total utility (TU) and Marginal Utility (MU): Total Utility (TU) Definition and Explanation “Total utility is the total is the total satisfaction obtained from all units of a particular commodity consumed …