Which statement is false? \((\mathrm{LO} 2,5)\) a) The water-diamond paradox can be resolved with the help of the law of diminishing marginal utility. b) We will consume a service when its marginal utility is equal to its price. c) The law of diminishing marginal utility has little validity today. d) None of the above.

The water-diamond paradox can be resolved with the help of the law of diminishing marginal utility. The water-diamond paradox is the observation that although water is more essential to human life, diamonds have a higher price in the market. The law of diminishing marginal utility helps to resolve this paradox by stating that as the consumption of a good increases, the marginal utility derived from each additional unit consumed decreases. In the case of water, its high abundance and low marginal utility when consumed in large quantities justify its low price. On the other hand, diamonds have a higher price due to their relative scarcity and the higher marginal utility obtained from each additional unit. So, this statement is true.

We will consume a service when its marginal utility is equal to its price. According to the consumer equilibrium condition, we consume a good or service until the marginal utility we obtain from consuming it is equal to the price we pay for it. In other words, we consume a good or service up to the point where the marginal utility derived from its consumption equals its price. This statement is true.

The law of diminishing marginal utility has little validity today. The law of diminishing marginal utility is still a valid economic concept today. It is a fundamental principle of microeconomics used to explain various phenomena such as the demand curve, consumer equilibrium, and the water-diamond paradox. This claim that the law has little validity today is false, making this statement our answer.

None of the above. This statement would be true if all of the previous statements were true, but since statement c is false, statement d itself is also false. In conclusion, The false statement among the given options is:

c) The law of diminishing marginal utility has little validity today.