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This study guide covers cost-benefit analysis, including explicit and implicit costs and marginal analysis. It explains the Law of Diminishing Marginal Utility and the Cost-Benefit Maximizing Principle (MB=MC). It also provides practice questions on these concepts and exam tips for the AP Microeconomics exam.
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Question 1 of 10
Cost-benefit analysis helps in making informed economic decisions by?
Ignoring all costs and focusing only on benefits
Weighing the costs against the benefits of a choice
Only considering monetary costs
Focusing only on the largest possible benefit