Owners of a parking lot are deciding whether or not to add more parking spaces to the lot.The owners should increase parking spaces as long as: A)LRMR=LRMC B)LRMRLRMC C)LRMR

Question

Owners of a parking lot are deciding whether or not to add more parking spaces to the lot.The owners should increase parking spaces as long as:​
A)​LRMR=LRMC
B)LRMR>LRMC
C)LRMR<LRMC
D)​None of the above

Quizplus · Accepted Answer

If LRMR (Marginal Revenue of an additional parking space) is greater than LRMC (Marginal Cost of adding an additional parking space), the owners should add more parking spaces. This is because the revenue gained from renting out the additional parking spaces will be greater than the cost of adding them. Therefore, option B is the best choice.

Owners of a Parking Lot Are Deciding Whether or Not