(Figure: Demand Curve) Refer to the figure. Which point onthe graph represents the value of the good in its next highestvalued use?
A)Point A
B)Point B
C)Point C
D)the origin

Question

(Figure: Demand Curve) Refer to the figure. Which point onthe graph represents the value of the good in its next highestvalued use?
A)Point A 
B)Point B 
C)Point C 
D)the origin

Quizplus · Accepted Answer

Point B represents the value of the good in its next highest valued use, as it is the point on the demand curve where the marginal benefit (MB) of consuming one additional unit of the good is equal to the price (P) of the good. Any point to the right of B on the demand curve would have a lower MB than the price, indicating that the good is less valuable in its next highest valued use.

(Figure: Demand Curve) Refer to the Figure