Marginal Benefit (MB)
Definition
Marginal Benefit refers to the additional satisfaction or utility that a consumer derives from consuming one more unit of a good or service.
Analogy
Think of eating slices of pizza. The first slice brings you a lot of enjoyment, but as you eat more slices, the additional satisfaction you get from each slice decreases. Marginal Benefit is like the diminishing enjoyment you experience with each additional slice.
Related terms
Marginal Analysis: This term refers to the process of comparing the marginal benefits and marginal costs of a decision in order to determine whether it is worth pursuing.
Consumer Choice: Consumer Choice involves selecting between different goods and services based on their individual preferences and constraints.
Opportunity Cost: Opportunity Cost is the value of the next best alternative that must be given up when making a choice.
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