The Law of Diminishing Marginal Utility Explained in One Minute: From Definition to Examples
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5 سال پیش
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The law of diminishing marginal
The law of diminishing marginal utility is a textbook example of something that sounds remarkably complicated to the untrained eye but is actually ridiculously serious to understand.
Before explaining what the law of diminishing marginal utility is all about, I've chosen to first define the concepts of utility and marginal utility. Furthermore, by providing examples of real-life situations in which the law of diminishing marginal utility is encountered, I did my best to build a bridge between an abstract concept and the real world.
Frankly, understanding the law of diminishing marginal utility is as simple as understanding that while drinking a glass of orange juice when you're thirsty is great... drinking ten is not that great :)
Or, to put it differently, even the definitions of the terms utility and marginal utility allude to the fact that even a good thing is bad as of a certain point and, indeed, there actually is such a thing as negative marginal utility.
As you'll be able to find out, one minute is more than enough to understand the law of diminishing marginal utility in a way that enables you do even explain it to people yourself later on. When you do, don't forget to remind them about the One Minute Economics YouTube channel :)
Before explaining what the law of diminishing marginal utility is all about, I've chosen to first define the concepts of utility and marginal utility. Furthermore, by providing examples of real-life situations in which the law of diminishing marginal utility is encountered, I did my best to build a bridge between an abstract concept and the real world.
Frankly, understanding the law of diminishing marginal utility is as simple as understanding that while drinking a glass of orange juice when you're thirsty is great... drinking ten is not that great :)
Or, to put it differently, even the definitions of the terms utility and marginal utility allude to the fact that even a good thing is bad as of a certain point and, indeed, there actually is such a thing as negative marginal utility.
As you'll be able to find out, one minute is more than enough to understand the law of diminishing marginal utility in a way that enables you do even explain it to people yourself later on. When you do, don't forget to remind them about the One Minute Economics YouTube channel :)
5 سال پیش
در تاریخ 1398/05/03 منتشر شده
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