What Are Some Real-Life Examples of Diminishing Marginal Utility?


Quick Answer

A common real-life example of diminishing marginal utility is the all-you-can-eat-buffet, according to Investopedia. As a person begins to fill up on food, the enjoyment declines with each serving until the satisfaction falls low enough to stop eating.

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Full Answer

In economics, the term diminishing marginal utility refers to something for which the utility decreases for every use, according to Investopedia. Another common example cited by Investopedia is the consumption of a chocolate bar. The total utility of something in economics refers to all of the marginal utility that derives from each use. According to Forbes, another real-life example of diminishing marginal utility attaches to excess bank reserves.

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