Which of the Following Statements About the Cost-Benefit Approach Is

question 116

Multiple Choice

Which of the following statements about the cost-benefit approach is true?

• A)Resources should be spent if they are expected to better attain company goals in relation to the expected costs of these resources.
• B)In a cost-benefit analysis, both costs and benefits are easy to obtain.
• C)Resources should be spent if the costs of a decision outweigh the benefits of the decision.
• D)A cost-benefit approach would not be appropriate for a decision to install a budget system or not.

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Definitions:

Government Purchases

Expenditures by government entities on goods and services that are part of government consumption or investment.

Producer Surplus

The difference between the amount producers receive from selling a good or service and the minimum amount they would accept for that good or service.

Price Floor

A price floor is a government- or authority-set minimum price below which a particular good or service cannot legally be sold, aiming to prevent prices from falling too low.

Widgets

A generic term commonly used to refer to an unspecified, fictional product used in examples and economic theory.