If a good is offered free of charge,one would _____
A)never stop consuming it.
B)stop consuming it when its marginal utility begins to fall.
C)stop consuming it when its marginal utility begins to increase.
D)stop consuming it when its marginal utility has declined to zero.
E)never consume it because it has no market value.

Question

Quizplus · Accepted Answer

According to the Law of Diminishing Marginal Utility, as the quantity of a good consumed increases, the marginal utility of each additional unit consumed eventually declines. So, if a good is offered free of charge, a rational consumer would continue to consume it until the marginal utility of the last unit consumed is zero. Therefore, the consumer would stop consuming it when its marginal utility has declined to zero, which is option D.

If a Good Is Offered Free of Charge,one Would _____