Why does a newspaper dispenser open to a stack of newspapers and essentially “trusts” a consumer to take just one copy whereas a soft drink vending machine does not “trust” consumers and dispenses one can for each purchase?
Please provide the best answer for the statement.
The difference is explained by the diminishing marginal utility of the two products. The marginal utility of a second newspaper taken from a newspaper dispenser is essentially zero for the consumer, so they have little incentive to take more than one copy. The marginal utility of the second can of soft drink, however, is not close to zero. The consumer can take that second can and save it for consumption the next day. In fact, the consumer has a great incentive to take all the cans because they can be stored or used in the future or resold whereas multiple newspapers are only good for one day and have little resale value.
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