This posting addresses marginal benefits and marginal costs.
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Marginal benefits and marginal costs
A. Capture the way total benefits and total costs change as the amount of an activity changes just a little bit
B. Are constant, regardless of the amount of an activity that is pursued
C. Tend to increase as a decision maker does more of an activity
D. Tend to increase as a decision maker does more of an activity
The marginal benefit of an action
A. Equals the additional benefit produced by extra units of X and tends to decrease as X increases
B. Equals the additional benefit produced by the total units of X and tends to increase as X increases
C. Equals the additional benefit produced by the total units of X and tends to decrease as X increases
D. Equals the additional benefit produced by extra units of X and tends to increase as X increases
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Solution Summary
The solution provides the correct answers to multiple choice questions regarding marginal benefits and marginal costs. References are also provided.
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1. The correct answer is A.
The main advantage of a marginal benefit and marginal cost analysis is that it shows the changes in the benefits and costs with varying degrees of activity. Management changes the ...
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