Diminishing marginal utility

One of the explanations for the law of demand and the downward sloping demand curve. Says that the more of any particular product consumers have, the less each additional unit is worth to them. In other words, the less scarce a particular product, the lower its value in the market. An example might be the iPhone, which when it came out was very scarce (in high demand but limited supply). Apple charged very high prices for the first iPhones. But as the product has become more widely available, each additional iPhone Apple makes is harder and harder to sell. It therefore must come out with new versions of the iPhone every year that are different from previous versions to keep demand strong.

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