As more of a public good is produced,the marginal benefit of each additional unit ________ and as more of a private good is produced,the marginal benefit of each additional unit ________.
A) increases; increases
B) increases; decreases
C) decreases; increases
D) decreases; decreases
E) does not change; does not change

Question

Quizplus · Accepted Answer

For public goods, as more of the good is produced, the marginal benefit of each additional unit typically decreases because the overall satisfaction or utility gained from consuming additional units of the good diminishes. Similarly, for private goods, the marginal benefit of each additional unit also decreases due to the law of diminishing marginal utility, where each additional unit of a good or service provides less additional satisfaction or utility than the previous unit.

As More of a Public Good Is Produced,the Marginal Benefit