Marginal Utility Theory is an economic concept that explains how individuals make decisions based on the additional satisfaction or benefit they receive from consuming one more unit of a good or service. This additional satisfaction is known as marginal utility. As a person consumes more of a good, the marginal utility typically decreases, meaning each additional unit provides less satisfaction than the previous one. This principle helps to understand consumer behavior and demand. For example, if someone enjoys eating pizza, the first slice may provide high satisfaction, but the fifth slice may offer much less. This diminishing marginal utility influences how much of a product people are willing to buy at different prices.