Q.The Total Utility derived by a consumer from successive units of a snack is: 1st unit — 20, 2nd — 36, 3rd — 48, 4th — 56, 5th — 60, 6th — 60, 7th — 56 utils. Derive the Marginal Utility schedule and identify the point of satiety.

Take successive differences of TU to get MU; the point of satiety is where MU first becomes zero.

MU: $20,16,12,8,4,0,-4$ (units 1–7). MU falls throughout — Law of DMU holds. Point of satiety: the 5th–6th unit, since TU is maximum (60) at the 6th unit, where MU is exactly zero.

Computing $MU_n=TU_n-TU_{n-1}$ for each unit:

The MU schedule (20, 16, 12, 8, 4, 0, −4) falls continuously, confirming the Law of Diminishing Marginal Utility throughout. The point of satiety — where the consumer's want for the snack is exactly and fully satisfied, with no further gain possible — occurs at the 6th unit, where Total Utility reaches its maximum value of 60 utils and Marginal Utility becomes exactly zero. Beyond this, at the 7th unit, MU turns negative (−4) and TU actually falls to 56, showing that the consumer would be worse off eating a 7th unit.

Confusing the point of satiety (where MU = 0 and TU is maximum) with the point where MU turns negative (the 7th unit, where TU is already falling) is a common slip — satiety is reached ONE unit earlier than the point where the consumer would actually start feeling worse off.