The Ethical Theory That Underlies Cost-Benefit Analysis Is

question 8

Multiple Choice

The ethical theory that underlies cost-benefit analysis is:

• A) libertarianism.
• B) utilitarianism.
• C) deontology.
• D) ethical relativism.

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Definitions:

Profit-maximize

A strategy where a firm makes decisions intended to achieve the highest possible profit.

Profit-maximizing

The point at which a firm achieves the highest possible profit, where the marginal cost of production equals the marginal revenue from sales.

Total Revenue

The total receipts from sales of goods or services over a certain period of time before any expenses are subtracted.

Variable Input

An input in the production process that changes quantity with the level of output, such as labor or raw materials.