In Economics, Marginal Analysis

question 69

Multiple Choice

In economics, marginal analysis:

• A) has no practical applications or real-world uses.
• B) eliminates incorrect decisions and bad choices.
• C) involves comparing the additional costs and additional benefits of an activity.
• D) involves examining only the total costs and total benefits of an activity.
• E) guarantees an incorrect decision.

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Definitions:

Confirmation Bias

Searching for (and giving more weight to) information and opinion that confirms what you believe rather than information and opinion to the contrary.

Over-Optimism

A tendency to have an overly positive outlook or expectations, particularly regarding projects or financial forecasts.

Frame Dependence

A psychological theory indicating that people's decisions are influenced by the way choices are framed or presented to them.

Technology Stocks

Shares in companies that operate in the technology sector, including hardware, software, and IT services.