A Farmer Is Deciding Whether or Not to Add Fertiliser

question 62

Multiple Choice

A farmer is deciding whether or not to add fertiliser to his or her crops. If the farmer adds 1 kilogram of fertiliser per hectare, the value of the resulting crops rises from $80 to $100 per hectare. According to marginal analysis, the farmer should add fertiliser if it costs less than:

• A) $12.50 per kilogram.
• B) $20 per kilogram.
• C) $80 per kilogram.
• D) $100 per kilogram.

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Definitions:

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