If the marginal cost of an activity exceeds the marginal benefit, then
A) the activity will occur because the high marginal cost means it must be highly valued.
B) the forgone alternatives' costs must be increased.
C) an alternative action will be selected.
D) the person must concentrate on the activity's total benefits.

Question

Quizplus · Accepted Answer

When the marginal cost of an activity exceeds the marginal benefit, it implies that the cost of continuing or increasing the activity outweighs the benefits gained from it. Therefore, a rational decision-maker would seek an alternative action that offers a better balance of marginal benefits to marginal costs.

If the Marginal Cost of an Activity Exceeds the Marginal