The principle (Miss Trunchbull) discovers that Bruce stole a piece of cake. As punishment, this (sadistic) principal wants Bruce to eat an entire cake. This song illustrates the concepts of diminishing marginal utility. The first piece of cake can be tasty – often worth a lot to people who enjoy cake. A second piece is not nearly as valuable. After a couple of pieces, the additional (marginal) utility from one more piece can be negative – meaning a person would need to be paid to eat an extra piece of cake.