Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
marginal cost
B
opportunity cost
C
total cost
D
sunk cost
Understanding the Answer
Let's break down why this is correct
Answer
In AP Microeconomics, the concept of marginal analysis helps individuals weigh the additional benefits against the additional costs of their choices. This means looking at the extra benefits you gain from doing something compared to the extra costs it brings. For example, if a student is deciding whether to study for one more hour for an exam, they would consider how much better their grade might improve (the benefit) versus how tired they will be and how much time they lose for other activities (the costs). By using marginal analysis, students can make more informed decisions that maximize their benefits while minimizing their costs. This approach is crucial for effective decision-making in both economics and everyday life.
Detailed Explanation
Marginal cost is the extra cost of doing one more thing. Other options are incorrect because Opportunity cost is what you give up when you make a choice; Total cost is the overall cost of all choices, not just the extra ones.
Key Concepts
Decision-making processes
Marginal benefits and costs
Scarcity
Topic
Exam Preparation Strategies
Difficulty
easy level question
Cognitive Level
understand
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