One of the assumptions of consumer theory is nonsatiation, in that more is always preferred to...
One of the assumptions of consumer theory is nonsatiation, in that more is always preferred to less. This implies that the marginal utility of consuming one more unit of a good can never be less than zero. In other words, consumption of an additional product will always lead to a greater amount of total satisfaction. Would you think this holds true in reality? Why or why not?
Homework Answers
In reality it is not true.
the marginal utility of consuming an extra unit can be negative i.e. after consuming one extra of the good the consumer can feel sick and that negative utility will decrease the total utility that the consumer has achieved in the market. In reality, the consumer has to stop consuming the goods when they feel that the marginal utility they are getting from that good will be less than the price they have paid for that good.
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One of the assumptions of consumer theory is nonsatiation, in
that more is always preferred to...
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Please help with these questions
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