MARGINAL UTILITY AND DEMAND: An explanation of the law of demand and the negatively-sloped demand curve can be found in the analysis of marginal utility and especially the law of diminishing marginal utility. This explanation rests on two propositions. One, the law of diminishing marginal utility means that the marginal utility obtained from consuming a good declines as the quantity consumed increases. Two, the marginal utility of a good underlies the demand price that buyers are willing and able to pay for a good. When combined, these two propositions indicate that the demand price buyers are willing and able to pay for a good declines as the quantity demanded (and consumed) increases. And this is the law of demand.

     See also | marginal utility | demand | law of demand | demand curve | law of diminishing marginal utility | demand price | quantity demanded |

MARGINAL UTILITY AND DEMAND, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2025. [Accessed: July 7, 2025].

Additional information on this term can be found at:

WEB*pedia: marginal utility and demand

Back to the GLOSS*arama

The negative slope of aggregate demand curve, reflecting the inverse relation between the price level and aggregate expenditures on real production, is attributable to three primary effects--real-balance effect, interest-rate effect, and net-export effect.

Complete Entry | Visit the WEB*pedia

Today, you are likely to spend a great deal of time looking for a downtown retail store looking to buy either a green and yellow striped sweater vest or a Boston Red Sox baseball cap. Be on the lookout for vindictive digital clocks with revenge on their minds.
Your Complete Scope

This isn't me! What am I?

-- Seneca, statesman, dramatist, philosopher

User Feedback