Net benefit is maximized where:
A) total benefit equals total cost.
B) marginal benefit equals marginal cost.
C) average benefit exceeds average cost by the greatest amount.
D) marginal benefit exceeds marginal cost by the greatest amount.

Question

Quizplus · Accepted Answer

Net benefit is maximized at the point where the marginal benefit of an action equals its marginal cost, according to economic theory. This is because it indicates the most efficient allocation of resources, where the cost of producing one more unit is exactly balanced by the benefit derived from that unit.

Net Benefit Is Maximized Where