Author Question: Define marginal cost and marginal benefit. What will be an ideal ... (Read 59 times)

ereecah · **on:** Jun 29, 2018

Define marginal cost and marginal benefit.

What will be an ideal response?

Question 2

In the figure above, suppose the government provides vouchers worth 15,000 per student per year. When the market is in equilibrium, marginal social benefit ________ marginal cost, and the number of students enrolled is ________.

A) exceeds; above the efficient quantity
B) exceeds; below the efficient quantity
C) is below; above the efficient quantity
D) is below; below the efficient quantity
E) equals; efficient

amynguyen1221 · **Reply #1 on:** Jun 29, 2018

Answer to Question 1

Marginal cost is the opportunity cost of an increase in an activity. Marginal benefit is the benefit of an increase in an activity.

Answer to Question 2

E