A useful rule of thumb is that the higher the marginal benefit a consumer gains from a product, the
A)more the consumer will seek substitutes for the product.
B)lower the consumer's demand for the product will be.
C)more price-sensitive the consumer will be.
D)higher the buyers' reservation price will be.

Question

Quizplus · Accepted Answer

The higher the marginal benefit a consumer gains from a product, the more valuable it is to the consumer, and therefore the higher the buyer's reservation price will be. A consumer's reservation price is the maximum price they are willing to pay for a product, and this will increase as the marginal benefit they receive from the product increases.

A Useful Rule of Thumb Is That the Higher the Marginal