Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
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Question
Chapter 1, Problem 1WNG
To determine
Marginal benefit curve and marginal cost curve.
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1.Suppose the marginal costs (MC) of reading are constant & the marginal benefits (MB) of reading decline (over time). Initially, the MB of Reading are greater than the MC. Draw the MB curve and MC curve of studying, & identify the efficient amount of reading. Then explain why the efficient point is the point at which the net benefits of reading are maximized. ________________________________________________2. Using the diagram you drew in question 1, lower the marginal costs of reading and identify the new efficient amount of reading. Also, identify the additional net benefits derived as a result of the lower marginal cost of reading.
Marginal Analysis is an examination of the additional benefits of an activity compared to the additional costs incurred by that same activity. This table displays a marginal analysis of buying an extra slice of pizza. The Marginal Benefit column represents the willingness to pay for each slice. Use the table to determine which of the following statements is most true?
A) You will purchase 1 slice of pizza because the Marginal Benefit of the second slice exceeds the marginal Cost.
B) You will purchase 2 slices of pizza because the Marginal Benefit of the third slice exceeds the marginal Cost.
C) You will purchase 3 slices of pizzas because the Marginal cost of the fourth slice exceeds the Marginal Cost.
D) You will purchase 2 slices of pizza because the marginal Cost of the third slice exceeds the marginal Benefit.
Because one’s productivity in the workplace is likely to be affected by one’s health, investment in health could increase earnings to the extent that one might spend money on health care without reducing his or her consumption of other goods.
Chapter 1 Solutions
Economics (MindTap Course List)
Ch. 1.2 - Prob. 1STCh. 1.2 - Prob. 2STCh. 1.2 - Prob. 3STCh. 1.3 - Prob. 1STCh. 1.3 - Prob. 2STCh. 1.3 - Prob. 3STCh. 1.4 - Prob. 1STCh. 1.4 - Prob. 2STCh. 1.4 - Prob. 3STCh. 1.4 - Prob. 4ST
Ch. 1 - Prob. 1QPCh. 1 - Prob. 2QPCh. 1 - Prob. 3QPCh. 1 - Prob. 4QPCh. 1 - Prob. 5QPCh. 1 - Prob. 6QPCh. 1 - Prob. 7QPCh. 1 - Prob. 8QPCh. 1 - Prob. 9QPCh. 1 - Prob. 10QPCh. 1 - Prob. 11QPCh. 1 - Prob. 12QPCh. 1 - Prob. 13QPCh. 1 - Prob. 14QPCh. 1 - Prob. 15QPCh. 1 - Prob. 16QPCh. 1 - Prob. 17QPCh. 1 - Prob. 18QPCh. 1 - Prob. 19QPCh. 1 - Prob. 20QPCh. 1 - Prob. 21QPCh. 1 - Prob. 22QPCh. 1 - Prob. 23QPCh. 1 - Prob. 24QPCh. 1 - Prob. 25QPCh. 1 - Prob. 26QPCh. 1 - Prob. 1WNGCh. 1 - Prob. 2WNGCh. 1 - Prob. 3WNG
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- Because one’s productivity in the workplace is likely to be affected by one’s health, investment in health could increase earnings to the extent that one might spend money on health care without reducing his or her consumption of other goods. True or Falsearrow_forwardCite three examples of recent decisions that you made in which you, at least implicitly, weighed marginal cost and marginal benefit.arrow_forwardIf the marginal cost of a cup of tea is greater than its marginal benefit, then to increase efficiency a. nothing should be done if the marginal benefit is greater than the marginal cost by the maximum amount because in this case the efficient quantity of cups of tea is being produced. b. more cups of tea should be produced. production should be halted. c. fewer cups of tea should be produced d. More information is needed about the price of a cup of tea in order to determine if production should be increased, decreased, or not changed.arrow_forward
- Which of the following statements is most true? You will purchase 2 slices of pizza because the Marginal Cost of the third slice exceeds the Marginal Benefit. You will purchase 2 slices of pizza because the Marginal Cost of the third slice exceeds the Marginal Benefit. You will purchase 3 slices of pizza because the Marginal Cost of the fourth slice exceeds the Marginal Cost. You will purchase 3 slices of pizza because the Marginal Cost of the fourth slice exceeds the Marginal Cost. You will purchase 2 slices of pizza because the Marginal Benefit of the third slice exceeds the Marginal Cost. You will purchase 2 slices of pizza because the Marginal Benefit of the third slice exceeds the Marginal Cost. You will purchase 1 slice of pizza because the Marginal Benefit of the second slice exceeds the Marginal Costarrow_forwardComplete the following table and answer the accompanying questions. Control Variable Q Total Benefits B(Q) Total Cost C(Q) Net Benefits Benefits N(Q) Marginal Benefit MB(Q) Marginal Cost MC(Q) Marginal Net Benefit MNB(Q) 100 1,200 950 210 60 101 1,400 70 102 1,590 80 103 1,770 90 104 1,940 100 105 2,100 110 106 2,250 120 107 2,390 130 108 2,520 140 109 2,640 150 110 2,750 160 a. At what level of the control variable are net benefits maximized? b. What is the relation between marginal benefit and marginal cost at this level of the variable? multiple choice Marginal cost is much smaller than marginal benefit. Marginal cost is slightly larger than marginal benefit. Marginal cost is slightly smaller than marginal benefit. Marginal cost is much larger than marginal benefitarrow_forwardNora's marginal benefit exceeds her marginal cost by the greatest amount when she is consuming 10 units of product Y. To maximize her net benefit, Norah should: Select one: a. consume more than 10 units of the product. b. have stopped consuming the product before he reached 10 units. c. give up more of good Y for another good d. stop consuming at 10 units. e. not enough information to answer the question.arrow_forward
- Studying has both cost and benefits. If you continue to study as long as the marginal benefits of studying are greater than the marginal costs and stop studying when the two re equal, will your action be consistent with having maximized the net benefits of studying? Explain your answer.arrow_forwardWhy is it important to perform a cost-benefit analysis when making a decision? A-It helps you to make rational choices. B-To make sure that the cost is greater than the benefit of a decision. C-It is required by the government in making economic decisions. D-It allows you to see the price of certain goods and services.arrow_forwardMatch each term with the correct definition. economics opportunity costmarginal analysis utilitya. The next-best thing that must be forgone in order to produce one more unit of a given product.b. The pleasure, happiness, or satisfaction obtained from consuming a good or service.c. The social science concerned with how individuals, institutions, and society make optimal (best) choices under conditions of scarcity.d. Making choices based on comparing marginal benefits with marginal costs.arrow_forward
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