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Definitions from the WebDiminishing MarginalDescription:Diminishing marginal refers to the concept in economics that states the decrease in the additional benefit gained from consuming or producing one more unit of a good or service. It highlights the idea that the more you have of something, the less valuable each additional unit becomes. Senses:Sense 1:Adjective - depicting the decrease in the incremental benefit obtained by consuming or producing an additional unit. Example: The law of diminishing marginal utility helps explain why the satisfaction we get from eating each additional slice of pizza decreases. Sense 2:Noun - the principle stating that the rate at which output increases eventually slows down as more and more units of input are added. Example: As the factory hired more workers, it experienced diminishing marginal returns, with each additional employee contributing less to overall production. Usages:Usage 1:Economics - In economics, the concept of diminishing marginal utility plays a crucial role in understanding consumer behavior and resource allocation. Example: The theory of diminishing marginal returns guides businesses in determining the optimal levels of production and staffing. Usage 2:Investing - Diminishing marginal benefit is taken into consideration by investors when deciding how much to allocate to different asset classes. Example: When diversifying an investment portfolio, it is important to consider diminishing marginal returns to achieve an optimal balance. Related products on Amazon: | ||||
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