If at a given quantity MB = MC,the decision maker should do _____ of the activity.

Question

Quizplus · Accepted Answer

When MB (marginal benefit) = MC (marginal cost), it means that the cost of producing or carrying out one more unit of the activity is equal to the benefit derived from that unit. At this point, the decision maker should continue doing the activity up to that point as the benefits equal the cost, and producing more will result in a cost greater than the benefit. Therefore, the best choice would be to continue with that amount of activity.

If at a Given Quantity MB = MC,the Decision Maker