Which of the following is NOT a net benefit maximizing rule?
A) Net benefit is maximized where marginal benefit equals marginal cost.
B) Net benefit is maximized where total benefit exceeds total cost by the greatest amount.
C) Net benefit is maximized where average benefit exceeds average cost by the greatest amount.
D) All of the above are net benefit maximizing rules.

Question

Quizplus · Accepted Answer

The correct net benefit maximizing rule is where marginal benefit equals marginal cost (A) and where total benefit exceeds total cost by the greatest amount (B). The statement that net benefit is maximized where average benefit exceeds average cost by the greatest amount (C) does not accurately describe a rule for maximizing net benefits, as it focuses on averages rather than marginal or total values.

Which of the Following Is NOT a Net Benefit Maximizing