The following table shows the relationship between the speed of a computer's CPU and its benefits and costs. Assume that all other features of the computer are the same (that is, CPU speed is the only source of variation), and only the CPU speeds listed below are available for purchase. Application of the Cost-Benefit Principle would lead one to purchase a ______ computer.

Question

The following table shows the relationship between the speed of a computer's CPU and its benefits and costs. Assume that all other features of the computer are the same (that is, CPU speed is the only source of variation), and only the CPU speeds listed below are available for purchase.  Application of the Cost-Benefit Principle would lead one to purchase a ______ computer.

Quizplus · Accepted Answer

At 3.0GHz and below, marginal benefit is greater than its marginal cost. But for 3.5GHz and above, marginal benefit is less than marginal cost. So, a 3.0GHz computer should be purchased.

The Following Table Shows the Relationship Between the Speed of a Computer's