Marginal Utility

The additional satisfaction gained from one more unit of something.

Marginal utility usually falls as consumption rises — the second slice of cake is worth less than the first — which is the foundation of downward-sloping demand. The idea also underpins risk aversion in finance: because each additional pound of wealth adds slightly less benefit, a loss hurts more than an equal gain helps.

Each extra hour of overtime brought less marginal utility than the one before it.