Which of the following best defines rational behavior?

Question

Quizplus · Accepted Answer

Rational behavior involves undertaking an activity only when the marginal benefit of that activity exceeds its marginal cost. This means that the individual will continue to engage in the activity as long as the additional benefit gained from it is greater than the additional cost incurred. This approach ensures that the individual is maximizing their utility or satisfaction from the activity. Analyzing total costs and benefits (options A and B) may not provide an accurate assessment of the most beneficial course of action, as it may not take into account the incremental effects of a decision. Option C is similar to D but takes an aggregate approach, which may not reflect the differences in benefits and costs across each activity.

Which of the Following Best Defines Rational Behavior