A Rational Decision Maker Takes an Action Only If The

question 101

Multiple Choice

A rational decision maker takes an action only if the:

• A)marginal benefit is greater than the marginal cost
• B)marginal benefit is less than the marginal cost
• C)average benefit is greater than the average cost
• D)marginal benefit is greater than both the average cost and the marginal cost

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Definitions:

Consumer Surplus

The difference between what consumers are willing to pay for a good or service versus what they actually pay.

Federal Trade Commission

The Federal Trade Commission is a United States federal agency established to protect consumers and promote competition by preventing anticompetitive, deceptive, and unfair business practices.

Sherman Antitrust Act

A landmark federal statute passed in 1890 in the United States, which prohibits monopolistic business practices and aims to promote competition.

Sherman Act

A foundational antitrust law in the United States that prohibits monopolistic practices and promotes competition, enacted in 1890.