When consumers or businessmen stop collecting information to make decisions at the point where marginal cost of data collection equals the marginal utility of the data, economists would call the decisions based on existing data

Question

Quizplus · Accepted Answer

When the marginal cost of data collection equals the marginal utility of the data, any further data collection would not provide additional utility. Therefore, making decisions based on existing data is known as optimally imperfect decisions. This means that the information collected is not perfect, but it is sufficient to make a reasonable decision.

When Consumers or Businessmen Stop Collecting Information to Make Decisions