As more of a good is consumed,marginal benefit ________ and as more of a good is produced,marginal cost ________.
A) increases; increases
B) increases; decreases
C) decreases; increases
D) decreases; decreases
E) does not change; does not change

Question

Quizplus · Accepted Answer

The law of diminishing marginal utility states that as more of a good is consumed, the marginal benefit or satisfaction derived from each additional unit consumed decreases. This means that the marginal benefit decreases as the quantity consumed increases. On the other hand, as more of a good is produced, the law of diminishing returns sets in, which means that as more units of a variable input are added to a fixed input, the marginal cost of production increases. Therefore, the correct answer is that as more of a good is consumed, marginal benefit decreases, and as more of a good is produced, marginal cost increases.

As More of a Good Is Consumed,marginal Benefit ________ and as More