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:

Issuance and Trading

Refers to the process of issuing new securities, like stocks or bonds, and their subsequent buying and selling on markets.

Prospectus

A legal document issued by companies that are offering securities for sale, containing details about the investment offering and the company's financial status.

Corporation End

The legal dissolution or termination of the existence of a corporation.

Director Liability

The legal responsibility of a company's directors for actions or omissions that lead to financial loss or legal penalties.