If you could pay for a product according to the marginal utility that you gain from additional consumption, then as you consume more of a product the price you pay would
A) remain the same.
B) increase.
C) be deferred.
D) decline.

Question

Quizplus · Accepted Answer

If you could pay for a product according to the marginal utility that you gain from additional consumption, then the price you pay would decline as you consume more of the product. Marginal utility is the additional satisfaction that a consumer gains from consuming one more unit of a good or service. As a consumer consumes more of a good, the marginal utility that he/she gains decreases. Therefore, if the price is based on marginal utility, it would make sense for the price to decrease as the consumer consumes more of the product. This would encourage the consumer to consume more of the product, which would lead to greater overall satisfaction.

If You Could Pay for a Product According to the Marginal