How do the income effect, the substitution effect, and diminishing marginal utility help explain the law of demand?

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asked Oct 9, 2019 204k views

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Nick Pampoukidis · Answer 1 · 2019-10-13T01:33:53+0000

The utility approach helps explain the law of demand. In fact, the demand curve for a normal good is downward sloping due to the law of diminishing marginal utility.

How do the income effect, the substitution effect, and diminishing marginal utility help explain the law of demand?

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