"I use it."
Translation:Ich benutze es.
benutze is actually the suggested answer when I see this page. Perhaps it was updated.
I think either should work.
[EDIT: My feeling for this is still a work in progress. Below is an explanation I found on the internet.]
Those two are really quite close but benutzen is more using as in really using it with an implied outwearing… nutzen is maybe more like “to benefit from” or “to employ”…
Ich nutze die U-Bahn.
"I use the subway."
I couldn’t use benutzen here, because I am not really using the entire thing. I am just taking a seat.
Du hast mich nur benutzt.
"You have only used me."
Here, nutzen wouldn’t work because it lacks the negative consumption-idea. If something looks “used” then it looks benutzt and not genutzt because nutzen doesn’t really leave traces. “Useful” is quite positive sounding and that is nützlich in German, whereas benutzbar again has this wearing down tone to it… it translates to “(still) useable”
“The use” if you mean the “purpose/benefit of a thing” is der Nutzen. The “use” as in “the activity of using it” is Benutzung… you can find that on public toilets a lot: Benutzung: 50 Cent
So… benutzen as “to inflict usage” is just stronger, more direct and has a bigger impact on the tool. That certainly doesn’t explain every single use case but I hope it is nützlich
by the way… in daily life I don’t use nutzen that much. If it isn’t benutzen I think I say nehmen quite a lot. For instance for the metro.