does it signify? To what causes is this familiar fact to be
attributed? The first stage of the answer is very ample. The many
individuals, whose purchases make up the demand for the commodity,
will buy smaller quantities now that the price is higher. Possibly
some of them may cease to buy it altogether; but as a rule it would be
reasonable to suppose that most people continue to buy a certain
amount though a smaller amount than hitherto. Let us turn our
attention, then, to the individual purchaser, and ask ourselves why he
(or let us say she) acts in the manner indicated. The obvious answer
is that the more she already has of anything, the less urgently does
she require a little more of it. If she buys 6 pounds of sugar every
week when the price is 7 cents a pound, but only 5 pounds when the
price is 8 cents, she shows by her action that she does not consider
that the additional utility she will derive from buying 6 pounds a
week rather then 5 pounds is worth as much as 8 cents. But she shows
at the same time that she thinks it worth 7 cents. For, when the price
is 7 cents, no one compels her to buy that sixth pound. She could
stop, if she chose, at five; and it may serve to make the point quite
plain if we suppose her actually to hesitate before she buys the
sixth. She has hitherto, let us say, been buying 5 pounds a week at 8
cents. To-day she enters the shop and finds the price is down to 7
cents. She asks for her customary 5 pounds; then she pauses, and a
minute later turns her order into six. What are the alternatives which
she has been weighing one against the other in that momentary pause?
Not the utility of the whole 6 pounds of sugar against the total price
of 42 cents. For she has already ordered the first 5 pounds; and the
decision to buy the sixth is taken independently and subsequently. She
has been sizing up the _increment_ of utility which a sixth pound
would yield, and she decides that this is worth the expenditure of a
further 7 cents. Again, when the price was 8 cents she need not have