If the Difference Between the Marginal Benefit and the Marginal

question 101

Multiple Choice

If the difference between the marginal benefit and the marginal cost of a good is as large as possible,

• A) resources are being used with maximum efficiency.
• B) resources would create more value producing other goods and hence the production of this good should be decreased.
• C) more of the good should be produced.
• D) allocative efficiency has been attained.
• E) Both answers A and D are correct.

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Definitions:

Resale Message

A message or advertisement promoting the sale of second-hand goods or previously owned items.

Positive Message

A communication that conveys good news, optimism, or encouragement.

Purchase Selection

The process of choosing a product or service to buy, often involving comparison of options, consideration of quality, and evaluation of price.

Routine Message

Standardized communications that convey regular, everyday information within or outside an organization.