Marginal utility

Why do you stop eating pizza after a few slices?

Imagine you're at a pizza party with friends, and you start eating slices of pizza. The first slice tastes amazing, but as you keep eating more slices, each one seems less exciting than the last.

The more pizza slices you eat, the less pleasure you get from each additional slice. This is because the first slice gives you the most enjoyment, and each subsequent slice adds less satisfaction.

Example

You eat 2 slices and love them both, but when you eat the 3rd slice, it's not as satisfying as the first two.

Remember this

The concept of diminishing marginal utility explains why you stop enjoying pizza after a few slices.

Text adapted from Wikipedia, licensed under CC BY-SA 4.0.

Related concepts

Pareto efficiency

Can you always make everyone happier without hurting anyone?

List of cognitive biases

Why do you choose a smaller reward now over a bigger one later?

Endowment effect

People value owned items more than unowned ones

Veblen good

Veblen goods defy the law of demand

Outline of economics

Why do we sometimes struggle to share resources fairly?

Deflation

Deflation increases the real value of money

Educational content, not financial advice.

Swipe through 100 ML concepts daily

Open Pocket Polymath