Marginal Utility Theory

Economic theory that does not say that the first $10 have more value than the next $10. (See MarginalUtility)

The MarginalUtilityTheory states that when you are producing at the best rate, the cost of producing the next unit over the best rate is equal to the income you will get for selling it, so you decide rather not to produce it.

Probably, the risk is too big that the product will be defective, so you better don't.

On the other hand, you are not doing this for the customer, you are doing this for yourself. If the customer is not willing to allow you any profit, I'm sorry but look for someone else.

---

Could someone translate this into English please? It seems to be saying something I'm interested in, but I'm having trouble understanding the precise meaning.

---

See http://www.mises.org/humanaction/chap7sec1.asp( BrokenLink ) for more info (not much clearer without a few readings, but at least more material).

---

Ditch Digging Example:

• Five shovels - 3 diggers - 2 of the shovels have marginal utility.

---

CategoryEconomics