Rational Choice by an Individual Implies

question 125

Multiple Choice

Rational choice by an individual implies:

• A)the use of a mathematical model when solving a problem.
• B)making decisions aimed at achieving some predetermined goal.
• C)that only monetary costs and benefits are weighed.
• D)that the individual will never regret any action taken.
• E)that scarcity can be eliminated for that individual.

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Definitions:

Marginal Product

The extra output, or increase in production, that results from adding one more unit of a specific input, while other inputs are kept constant.

Total Product

The total quantity of output produced by a firm over a given period of time.

Average Product

The output per unit of a particular input, calculated by dividing total output by the quantity of inputs.

Labor

Human effort, either physical or mental, used in the production of goods and services.