How Does Decision Making Under Profit-Maximization Compare with Benefit-Cost Analysis

question 34

Multiple Choice

How does decision making under profit-maximization compare with benefit-cost analysis?

• A) Benefit-cost analysis is more comprehensive than profit-maximization since it includes the value of consumer surplus.
• B) Even in the presence of externalities, profit-maximization leads to efficient outcomes, while benefit-cost analysis does not.
• C) Profit maximization internalizes the cost of externalities unlike benefit-cost analysis.
• D) A public program should be implemented on the basis of profit-maximization principles and not benefit-cost analysis.
• E) Under profit-maximization, the benefits and costs from a program are usually overstated.

Recognize the importance of diverse cultural and socioeconomic backgrounds in developmental research.

Differentiate between stage theories and incremental theories of development.

Comprehend modern multidimensional theories of development.

Describe the concept of developmental psychopathology and its approach to life span development.

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Definitions:

Blanket Inventory Lien

A legal claim on all inventory items of a borrower by a lender as collateral for a loan.

Commercial Paper

A type of unsecured, short-term debt instrument issued by corporations, typically used for the financing of payroll, accounts payable, and inventories.

Best Interest Rate

The most favorable interest rate available to a borrower based on their creditworthiness and market conditions.

Secured Loan

A loan backed by collateral, providing the lender with a form of security that can be claimed if the borrower fails to repay the loan.