Suppose that the marginal benefit of an activity is less than the marginal cost,then
A) The net benefit would be increased by reducing the amount of the activity
B) The net benefit would be decreased by reducing the amount of the activity
C) The net benefit would be increased by increasing the amount of the activity
D) There can be no marginal improvement by changing the amount of the activity

Question

Quizplus · Accepted Answer

If the marginal benefit is less than the marginal cost, it means that the activity is not providing enough benefit to justify the cost. Therefore, reducing the amount of the activity would decrease the cost while only marginally reducing the benefit, leading to a higher net benefit overall.

Suppose That the Marginal Benefit of an Activity Is Less