Marginal Cost and Marginal Benefits

What is marginal cost?

• is the change in total cost      resulting from an action

• is the change in your options    resulting from an action

• change in the total benefit resulting from an action

• the change in revenue resulting from an action

What is marginal benefit?

• the benefit of having a great amount of capital.

• the benefit of selling products at a high level.

• is the change in total cost      resulting from an action.

• change in the total benefit resulting from an action

What does effective decision making require?

• comparing your debt and your credit score for each choice.

• comparing the revenue and profits for each choice.

• comparing the additional costs (marginal costs) and additional benefits (marginal benefits) for each choice.

• comparing your expenses and your income for each choice.

What is another way to define marginal cost?

• Goods/Services

• Gains/Positive

• Cost/Lose

• Income/Revenue

What is another way to define marginal benefit?

• Cost/Lose

• Gain/Positive

• Income/Revenue

• Debt/Income

A consumer purchases a bag of chips. After the consumer eats the chips, they have no desire to purchase another bag of chips. Is this marginal cost or marginal benefit?

• Marginal Cost

• Marginal Benefit

A consumer wants to purchase a t-shirt for $20. There is a sale that allows the consumer to purchase another shirt for $10. The shirts only cost $5 to make. Is this marginal cost or marginal benefit?

• Marginal Cost

• Marginal Benefit

Effective decision-making requires comparing the additional costs (marginal costs) and additional benefits (marginal benefits) for each choice.

• True

• False

Marginal cost, which is the small but measurable change in the expense to the business if it produces one additional unit.

• True

• False

Marginal benefit is a small, but measurable, change in a consumer's disadvantage if they use an additional unit of a good or service.

• True

• False