What does it mean to "think at the margin"? How is thinking at the margin related to determining best choices?
What will be an ideal response?
Thinking at the margin means to think about what happens to the costs and benefits of an activity as the activity changes just a little bit. The change in total cost that results from a small change in an activity is referred to as marginal cost. The change in total benefit that results from a small change in an activity is referred to as marginal benefit. Determining the best choice of an activity requires a comparison of the marginal costs and marginal benefits of the activity. If the marginal benefit of an activity exceeds the marginal cost, then net benefit can be increased by increasing the amount of the activity. If the marginal cost of an activity exceeds the marginal benefit, then net benefit can be increased by decreasing the amount of the activity.
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_____ and _____ are examples of complementary products
a. Coke; Pepsi b. Coffee; tea c. Hot dogs; hot dog buns d. Pens; pencils
The distinction between discretionary fiscal policy and the use of automatic stabilizers is that _____
Fill in the blank(s) with the appropriate word(s).
Often people trying to withdraw money from their bank must wait in line, which reflects a ________ allocation method
A) first-come, first-served B) market price C) contest D) command
In a market with imperfect product competition, the MRP declines because
a. the MP declines with each worker hired. b. the price of output falls as output increases. c. both output price and the MP decline as output increases. d. MC declines as output increases.