The Law of Diminishing Marginal Utility and The Law of Equi- Marginal Utility.
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Law of Diminishing Marginal Utility (DMU) states that as we consume more and more units of a commodity, the utility derived from each successive unit goes on decreasing.
People spend their income on various goods because consuming more and more of anyone good reduces the marginal satisfaction obtained from further consumption of the same good.
The law of equi-marginal utility is an extension of the law of DMU. It states that with the limited that a person has, he aims to spend it on different commodities and earn maximum and equal satisfaction from them.
He should such a combination of goods so that the utility derived from the last unit of the goods are the same.