Refer to the figure below, which shows marginal benefits (MB) and marginal cost (MC) of activity A:
If the decision maker is choosing 300 units of activity A,
A. if the activity is increased by one unit, net benefits will increase by $20.
B. if the activity is decreased by one unit, net benefits will decrease by $20.
C. this level maximizes net benefits.
D. both b and c
E. all of the above
Answer: C
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