Monthly Archive: December 2015

Economics: The Law of Diminishing Marginal Utility

As we have been discussing, economics is really the study of how people make decisions, based on what they want to get. Economics has many numbers, graphs, and other calculations that depend on numbers, but it only tries to predict how people will act, based on human nature. The economic law that is probably the most easy to relate with, is the Law of Diminishing Marginal Utility. The Law of Diminishing Marginal Utility says, you will get the most satisfaction from the first unit of something that you have, eat, see, and so forth. For the second unit, you will...