Consumer and Producer Surplus

Question 1

Diminishing marginal utility

Answer 1

As you consume more of a good, the marginal utility from each extra unit will decrease.

E.g. as you eat more cupcakes, the marginal benefit of the next cupcake goes down each time as you become less hungry

Question 2

Marginal utility

Answer 2

The additional benefit received from consuming an extra unit of a good.