Utility Theory and Consumer Behavior
Economics Revision Article Series
Authors
Utility denotes satisfaction.
Marginal utility: Marginal is used in the sense of extra unit.Marginal utility is the utility of an extra unit of consumption.
Law of diminishing marginal utility
This laws says or postulates that the amount of extra or marginal utility declines as a person consumes more and more of a good.
The law of equimarginal utility per dollar
it states that each good is demanded up to the point where the amrginal utility of the last dollar spent on it is exactly the same as the marginal utility of the last dollar spend on any other good.
References
Paul Samuelson and William D. Nordhaus, Economics, 13th Edition, McGraw-Hill, 1989
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