Optimization Using Marginal Analysis Analyzes ________

question 83

Multiple Choice

Optimization using marginal analysis analyzes ________.

• A) the total net benefits of different alternatives
• B) only the costs of an alternative and not the benefits
• C) the total net benefits of the alternative that looks the most attractive
• D) the change in the net benefits resulting from a shift from one alternative to another

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Definitions:

Long-run Profit

The amount of financial gain achieved over a longer period, taking into account all fixed and variable costs.

Market Demand Curve

Curve relating the quantity of a good that all consumers in a market will buy to its price.

Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity of the good that consumers are willing to purchase at various prices.

Incumbent Firm

An established company that holds a dominant position in a particular market or industry.