Economics Marginal Utility Questions
Marginal utility influences demand by determining the additional satisfaction or benefit a consumer derives from consuming an additional unit of a good or service. As the marginal utility decreases with each additional unit consumed, consumers are willing to pay less for each subsequent unit. This leads to a downward-sloping demand curve, as consumers demand less of a good or service at higher prices and more at lower prices. In summary, marginal utility influences demand by shaping consumers' willingness to pay for additional units of a good or service.