Final answer:
The correct answer to the question "As we consume more of a good" is A. Marginal benefit decreases. This is due to the law of diminishing marginal utility and is reinforced by the law of diminishing returns in production. Rational consumer behavior also accounts for opportunity cost in these scenarios. The correct option is A.
Step-by-step explanation:
As we consume more of a good, the concept to consider is the law of diminishing marginal utility, which states that the utility we get from additional units of a good or service tends to become smaller compared to what we got from earlier units. Therefore, when a student asks, "As we consume more of a good: A. Marginal benefit decreases B. Marginal benefit stays the same C. No correct answers D. Marginal benefit increases," the correct answer is A. Marginal benefit decreases.
This principle is closely related to the law of diminishing returns, which describes a similar decline but in the context of resource addition in production processes. Through marginal analysis, decisions are evaluated based on their small incremental changes to the current status quo. Furthermore, when making consumption choices, a rational consumer would consider the opportunity cost, which is the value of the next best forgone alternative, to ensure that the marginal utility of additional consumption exceeds this cost.