A Simple Scoring Model Is Used to Decide Among Three

question 2

Multiple Choice

A simple scoring model is used to decide among three projects that we'll call A,B,and C.The total score for project A is 30,for project B is 20,and for project C is 10.Which of the following statements is BEST?

• A)If project A is successfully completed,it will yield three times the benefits that project C would have provided.
• B)If project C is chosen,the company would benefit only half as much as if they had chosen project B.
• C)Project C is better than project B for this company at this point in time.
• D)Project A is better than project B for this company at this point in time.

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Definitions:

Marginal Revenue

The incremental revenue earned by selling one more unit of a good or service.

Inelastic

Describing demand or supply that is relatively unresponsive to price changes, meaning the percentage change in quantity is less than the percentage change in price.

Zero Production Costs

The hypothetical situation in which a good or service can be produced with no expenditure or effort, leading to an unlimited supply.

Profit-Maximizing Monopolist

A monopolist that sets its output and price levels to achieve the highest possible profit, given its unique position as the sole supplier in the market.