If the Marginal Benefit of the Next Slice of Pizza

question 23

Multiple Choice

If the marginal benefit of the next slice of pizza exceeds the marginal cost,you will

• A)be unable to choose between eating and not eating.
• B)not eat the slice of pizza.
• C)eat the slice of pizza.
• D)eat half the slice.
• E)More information is needed about how much the marginal benefit exceeds the marginal cost to determine if you will or will not eat the slice.

---

Definitions:

Marginal Income Tax Rate

The proportion of tax levied on your earnings for every tax bracket you fall into.

Retained Earnings

Profits that a company has earned to date, less any dividends or other distributions paid to shareholders.

Risk-Free Rate

The theoretical rate of return on an investment with zero risk, representing the interest an investor would expect from a completely safe investment.

Beta

A measure of a stock's volatility in relation to the overall market; a higher beta indicates greater volatility.