Figure 3.2 shows the total cost and total benefit curves for a professional guitarist.If the guitarist is currently practicing 1 hour per day,then:
A) she should practice more because net benefits would increase.
B) she should practice less because net benefits would decrease.
C) she should practice less because net benefits would increase.
D) she should practice more because net benefits would decrease.

Question

Figure 3.2 shows the total cost and total benefit curves for a professional guitarist.If the guitarist is currently practicing 1 hour per day,then: 
A) she should practice more because net benefits would increase. 
B) she should practice less because net benefits would decrease. 
C) she should practice less because net benefits would increase. 
D) she should practice more because net benefits would decrease.

Quizplus · Accepted Answer

At the current level of practice (1 hour per day), the marginal cost (MC) is lower than the marginal benefit (MB). Therefore, the net benefit (MB-MC) is positive, but not maximized. To maximize net benefit, the guitarist should practice more, until MB=MC, which happens at 3 hours of practice per day. At that point, the net benefit is maximized and any further practice would decrease net benefit. Therefore, option A is the best choice.

Figure 32 Shows the Total Cost and Total Benefit Curves for for a Professional