-Refer to Figure 3.1.Which graph best represents the marginal benefit of an activity?
A) A
B) B
C) C
D) D

Question

-Refer to Figure 3.1.Which graph best represents the marginal benefit of an activity?
A) A 
B) B 
C) C 
D) D

Quizplus · Accepted Answer

Marginal benefit is the additional benefit derived from consuming one more unit of a good or service. In Figure 3.1, graph A shows a downward-sloping curve, which indicates that as more units of the activity are consumed, the marginal benefit decreases. This is consistent with the law of diminishing marginal utility, which states that as more of a good or service is consumed, the additional satisfaction derived from each additional unit decreases.