Based on law of diminishing marginal utility,explain how the consumer equilibrium consistent wif law of demand

Question

Based on law of diminishing marginal utility,explain how the consumer equilibrium consistent wif law of demand

Answer 1

Since consumer equilibrium is achieved there all goods satisfy MU/P condition so consumer will agree to purchase one extra unit only for cheaper price with falling marginal utility but MU/P will  remain the same thus keeping consumer in equilibrium.

Each extra unit means increase in quantity demanded and MU/P gives price increments to keep balance.