Marginal utility is a change in total utility

Diminishing marginal utility concerns successive units of one good.

If total utility from one, two, and three slices is 20, 35, and 45 utils, marginal utilities are 20, 15, and 10. Total utility is still rising, but at a diminishing rate. Marginal utility becomes negative only if another unit reduces total utility. This is not required for diminishing marginal utility to begin.

Marginal utility is recovered from adjacent totals: MU_n=TU_n-TU_n-1 when quantity changes by one. The first slice raises total utility from zero to 20, so its marginal utility is 20. The second raises it from 20 to 35, so its marginal utility is 15. The level 35 is not the second slice’s marginal utility. It is utility from both slices together.

Total utility reaches its maximum where marginal utility changes from positive to negative. At the fourth slice, total utility is 50. The fifth lowers it to 48, so its marginal utility is negative. Diminishing marginal utility began much earlier, when the second slice added less than the first. “Diminishing” means falling marginal increments, not falling total satisfaction.

Diminishing marginal utility helps explain downward-sloping demand. A buyer will purchase additional units only at lower prices because later units provide less additional benefit. It does not mean a good becomes undesirable or that all people have identical utility schedules.

Utility numbers are ordinal tools in this model: they help rank bundles and compare marginal gains for one consumer. A statement that one person has 100 utils and another 80 does not establish that the first is 25 percent happier. Introductory utility schedules are used to analyze choices, not to make interpersonal welfare measurements.

Diminishing does not mean negative

Total utility from four hours of recreation is 30, 54, 70, and 80. Marginal utilities are 30, 24, 16, and 10. Every hour adds positive utility, so total utility keeps rising. Marginal utility nevertheless diminishes because each added hour contributes less than the previous one.

Diminishing marginal utility is about successive units of the same good over a relevant period, holding other consumption conditions reasonably stable. It does not imply that the first unit of every good gives the same utility or that preferences cannot change. A hungry consumer and a full consumer can have different schedules.

For choice, marginal utility must be compared with price. A later unit with lower marginal utility may still be worth buying if its price is low. Conversely, a high marginal utility does not guarantee purchase if the unit is expensive or unaffordable. The next topic adds the budget constraint needed to turn utility into a complete decision.

In a table, verify each marginal entry by adding it back to the previous total. If total utility is 35 and the next marginal utility is 10, the next total must be 45. This reverse check catches a skipped row or a mistaken average before the number is used in a per-dollar comparison.