What does diminishing marginal utility imply?

Diminishing marginal utility is a key concept in microeconomics that describes how the additional satisfaction or utility gained from consuming an extra unit of a good diminishes as more units are consumed. When a consumer enjoys a good, the first unit they consume typically provides the highest level of satisfaction. However, as they continue to consume more of that good, the satisfaction gained from each subsequent unit tends to decline.

This principle is foundational in understanding consumer behavior. For example, consider a scenario where someone eats slices of pizza. The first slice may bring a great deal of enjoyment; the second slice will likely be enjoyable as well, but perhaps not as much as the first. By the time the person reaches the third or fourth slice, each additional slice provides less satisfaction than the previous one. This decline in satisfaction with each additional unit reinforces the idea encapsulated in the correct choice, which states that each additional unit of a good adds less to utility than the prior unit.

The other options suggest scenarios that do not align with the concept of diminishing marginal utility. Some propose increasing utility with additional consumption, or imply that total utility decreases or remains constant, which contradicts the basic premise that total utility can increase but at a decreasing rate due to diminishing marginal utility.