Principles of Microeconomics, 7th Edition

Published by South-Western College
ISBN 10: 128516590X
ISBN 13: 978-1-28516-590-5

Chapter 1 - Part I - Ten Principles of Economics - Questions for Review: 3

Answer

The marginal benefit of a glass of water depends on the individual. For people with access to a large supply of water, a glass of water will have a small marginal benefit. Most likely, they have consumed enough water, so an extra glass of water will provide little health benefits. For a person with poor access to water, a glass of water will have a large marginal benefit, as that additional glass of water will provide them with immense health benefits and keep them alive.

Work Step by Step

The principles of economics hold that rational people think at the margin. In other words, rational people consider the marginal benefit of an item, which is the additional benefit received by using an additional unit of that item (such as an additional glass of water).
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