Marginal analysis studies how individuals decide:
A) whether to live on the margin of society.
B) whether to do a bit more of an activity versus a bit less of it.
C) whether to go to university.
D) how much down payment to make when buying stocks.

Question

Quizplus · Accepted Answer

Marginal analysis is all about making decisions on the margin or on the brink of the decision. In other words, it studies how individuals make choices when presented with options of doing a bit more of an activity versus a bit less of it. This can apply to a wide range of factors, such as how much to work, how much to invest, how much to spend, or how much to consume. All of these factors involve trade-offs, and marginal analysis can help individuals optimize their decisions by weighing the costs and benefits of each option.

Marginal Analysis Studies How Individuals Decide