The expected marginal utility of the next unit of water is diminishing.

Charles Blackorby has written:

'A sceptical exposition of the expected utility hypothesis' -- subject(s): Utility theory

people can be expected to satisfy their most pressing needs first, marginal utility normally declines with increasing availability of a good or service. A simple example is money. If someone has no money then $100 has a marginal utility of $100 to them, as they can be expected to spend it on the basic necessities of life. If someone already has $100,000, then $100 has very little marginal utility to them, perhaps far less than $100.

Diminishing marginal utility implies that, for each unit of production consumed, utility is increasing at a decreasing rate. Therefore, a consumer's greatest utility gain is always at the first unit of a good and then steadily falls to 0 as they approach infinity. A consumer's willingness to pay for a good depends on their expected utility gain, so as quantity approaches infinity, willingness-to-pay approaches 0 at a diminishing, negative rate.

form utility

time utility

place utility