Answer the following question in your own words without quoting anyone:
What is the diminishing marginal concept? Is there a parallel between
diminishing marginal utility in consumption and diminishing returns in
production? Describe any similarities you see.
Diminishing marginal means that there will be decline in the satisfaction or productivity beyond the optimal point. Utility is the satisfaction that an individual gains from consuming a given amount of goods or services in an economy.
Marginal utility refers to the additional satisfaction a consumer derives from the consumption of one extra unit of a product. Therefore, the greater the supply of a product, the smaller its marginal utility. Hence there is diminishing marginal utility.
This is also applicable to production due to diminishing marginal productivity. This means that there will be decline in productivity per unit beyond the optimal ...
Response explains the diminishing marginal concept, diminishing marginal utility in consumption and diminishing returns in production.