A Firm Can Profitably Introduce a New Activity If and Only

question 27

Multiple Choice

A firm can profitably introduce a new activity if and only if:

• A) the activity's direct benefit exceeds its opportunity cost.
• B)the activity's direct benefit equals its opportunity cost.
• C) all the constraints become nonbinding.
• D) the slope of the resource constraint equals the slope of the objective function.
• E) the shadow price of any one of the resources becomes zero.

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Definitions:

Superego

In psychoanalytic theory, the part of the personality that acts as a moral center, enforcing ethical standards and societal norms.

Psychosexual Development

Freud's theory that childhood development occurs in a series of fixed psychosexual stages, each characterized by different urges and conflicts.

Oral Stage

The first stage in Freud's psychosexual development, occurring in the first year of life, where pleasure is centered on oral activities such as sucking and biting.

Anal Stage

In psychoanalytic theory, the second stage of psychosexual development, occurring from about 18 months to three years of age, where the focus of pleasure is on controlling bladder and bowel movements.