Car owners will continue to seek information about possible repairs until the marginal cost of obtaining one more opinion _________________ the expected marginal benefit from the information contained in that opinion.
A) equals
B) is greater than
C) is less than

Question

Quizplus · Accepted Answer

When the marginal cost of obtaining one more opinion equals the expected marginal benefit from the information contained in that opinion, car owners will have obtained enough information to make a decision. If the marginal cost is greater than the expected marginal benefit, car owners will not seek additional information, as it would not be worth the effort and cost. If the marginal cost is less than the expected marginal benefit, car owners will continue seeking information until the costs and benefits are equal. Therefore, option A) equals is the best choice.

Car Owners Will Continue to Seek Information About Possible Repairs