The efficient number of gifts that a gift-giver wants to give is the number at which the marginal benefits of giving a gift are__________________the marginal costs of giving a gift.
A) greater than
B) less than
C) equal to
D) less than or equal to

Question

Quizplus · Accepted Answer

The efficient number of gifts that a gift-giver wants to give is the number at which the marginal benefits of giving a gift are equal to the marginal costs of giving a gift. At this point, the gift-giver is maximizing their overall satisfaction or utility. If the marginal benefits exceed the marginal costs, the gift-giver may want to consider giving additional gifts to increase their overall utility. Conversely, if the marginal costs exceed the marginal benefits, the gift-giver may want to reconsider giving the additional gifts, as doing so will decrease their overall satisfaction or utility. Therefore, the most efficient number of gifts is where the marginal benefits equal the marginal costs.

The Efficient Number of Gifts That a Gift-Giver Wants to Give