Use the Following Marginal Benefit and Marginal Cost Functions for Activity

question 40

Multiple Choice

Use the following marginal benefit and marginal cost functions for activity A: MB = 100 - 5A
MC = 20 + 3A
The fifth unit of activity A will

• A)increase net benefits by 75.
• B)reduce net benefits by 35.
• C)increase net benefits by 40.
• D)decrease net benefits by 40.
• E)reduce net benefits by 75.

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Definitions:

FICA-OASDI

Stands for Federal Insurance Contributions Act - Old Age, Survivors, and Disability Insurance; it's a payroll tax that funds Social Security and Medicare in the United States.

FICA-Medicare

A portion of the Federal Insurance Contributions Act tax that funds Medicare, a federal health insurance program for people who are 65 or older and certain younger people with disabilities.

Net Pay

The amount of money an employee receives after deductions such as taxes and retirement contributions are subtracted from the gross pay.

FICA-OASDI

The Federal Insurance Contributions Act - Old Age, Survivors, and Disability Insurance, a payroll tax funding Social Security and Medicare in the U.S.