Even though the marginal utility decreases after each additional unit is purchased, the consumer may purchase additional units based on their given economic conditions, such as their budget constraint.
Work Step by Step
Marginal utility is the amount of additional usefulness or pleasure derived from the purchase of an additional unit of an object. Whether or not a consumer buys an additional object depends on many additional variables, such as the availability of substitutional objects, their current economic situation, or the state of the overall economy at a given point. Budget constraint is an economic term used to describe an indivudual's disposable income.