A store remains open from 8 a.m. to 4 p.m. each weekday. The store owner is deciding whether to stay open an extra hour each evening. The owner's marginal benefit
A) is the benefit the owner receives from staying open from 8 a.m. to 5 p.m.
B) depends on the revenues the owner makes during the day.
C) must be greater than or equal to the owner's marginal cost if the owner decides to stay open.
D) is the benefit the owner receives from staying open from 8 a.m. to 6 p.m.

Question

Quizplus · Accepted Answer

Marginal benefit refers to the additional benefit received from an extra unit of an activity, in this case, staying open an extra hour. If the owner decides to stay open, it implies that the marginal benefit (additional revenue or benefit from staying open another hour) is at least as great as the marginal cost (extra expenses for that hour). Choices A and D incorrectly define marginal benefit as the benefit of being open for the entire day or two extra hours, respectively, and B incorrectly ties marginal benefit solely to daytime revenues.

A Store Remains Open from 8 A