-Suppose a factory can be designed to produce either trucks or cars. The figure above shows the marginal cost and marginal benefit of producing trucks in terms of the forgone cars.
a) What is the marginal benefit of the 25th truck?
b) What is the marginal cost of the 25th truck?
c) Should the 25th truck be produced? Why or why not.
d) What is the marginal benefit of the 75th truck?
e) What is the marginal cost of the 75th truck?
f) Should the 75th truck be produced? Why or why not?
g) What is the allocatively efficient quantity of trucks?
Definitions:
Cognitive Functions
Mental processes that include thinking, knowing, remembering, judging, and problem-solving.
Psychological Benefit
A positive effect on an individual's mental health, such as improved mood, reduced anxiety, or enhanced cognitive functioning.
Friendships
A close and mutual relationship between two people that typically involves affection, trust, and support.
Positive Psychology
A field within psychology dedicated to examining how humans thrive and function positively across various aspects, such as biological, individual, interpersonal, organizational, societal, and international levels of living.
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