Refer to the figure below, which shows marginal benefits (MB) and marginal cost (MC) of activity A:
If the decision maker is choosing 400 units of activity A,
A. the activity could be increased by one unit and net benefits will increase by $15.
B. this level maximizes net benefits.
C. the activity could be reduced by one unit and net benefits will rise by $25.
D. the activity could be reduced by one unit and net benefits will increase by $10.
E. the activity could be reduced by one unit and net benefits would decrease by $10.
Answer: D
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Consider a perfectly competitive firm with MC = 10 + q. If market demand is Q = 100 - P and the current industry output is 80 units, then the firm will produce
a. zero units. b. 10 units. c. 20 units. d. the answer cannot be determined without knowing what the supply curve is.
Which of the following statements best describes balanced budget amendments?
a. A balanced budget amendment allows small, temporary deficits that might, in some cases, be necessary. b. A balanced budget amendment prevents even small, temporary deficits that might, in some cases, be necessary. c. A balanced budget amendment allows large, temporary deficits that might, in some cases, be necessary. d. A balanced budget amendment prevents large, temporary deficits that might, in some cases, be necessary.
An economy’s natural rate of output is ______.
a. equal to its real GDP per capita b. how much it will produce at its potential output c. independent of its resources d. unchanging year to year
In the U.S. economy, services account for over half of all consumer expenditures.
Answer the following statement true (T) or false (F)