The Principle of Decreasing Marginal Benefit Means That as the Quantity

question 230

Multiple Choice

The principle of decreasing marginal benefit means that as the quantity of a good consumed

• A) decreases, its marginal benefit decreases.
• B) increases, its marginal benefit decreases.
• C) increases, its total benefit decreases.
• D) None of the above answers is correct.

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Definitions:

Rate of Return

The gain or loss on an investment over a specific period, expressed as a percentage of the investment's cost.

Required Return

The minimum rate of return on an investment that is necessary for it to be considered a viable option, taking into account its risk level.

IRR

In capital budgeting, the Internal Rate of Return serves as a tool for estimating the potential returns on investment projects.

Investment

The allocation of resources, usually money, into assets or projects expected to generate future returns or profit.