The marginal benefit of each additional unit of a good consumed
A) increases as more is consumed.
B) will maximise consumer surplus.
C) is always equal to its marginal cost.
D) is equal to the deadweight loss if the unit of the good is not produced.
E) decreases as more is consumed.

Question

Quizplus · Accepted Answer

The marginal benefit of each additional unit of a good consumed decreases as more is consumed, due to the law of diminishing marginal utility. As a consumer obtains more units of a good, each additional unit becomes less valuable to them.

The Marginal Benefit of Each Additional Unit of a Good