T1 The marginal concept Flashcards
1
Q
What is marginal analysis
A
Marginal analysis considers the effects of make a small change to a current situation. Example producing or consuming a single additional item
2
Q
What are the three types of marginal benefit
A
Low marginal benefit.
Negative marginal benefit.
High marginal benefit.
3
Q
Define net benefit
A
In any exchange they will be both of course and a benefit.
The net benefit we gain will be the difference between the two.
Benefit minus cost.
4
Q
How do you find the net benefit
A
It is the moment on the curve with the distance between the total cost in total benefit is the greatest
MC = MB
