IGNOU BRL 104 2026 - How can marginal analysis and cost benefit analysis serve as

Question

How can marginal analysis and cost benefit analysis serve as tools for evaluating alternatives?

23 Apr 2026

Answer :

Word Count : 402

Marginal analysis and cost benefit analysis are essential decision-making tools in retail management, particularly when evaluating alternatives related to pricing, inventory, promotion, and resource allocation. Marginal analysis focuses on examining the additional benefits and additional costs associated with a small change in a decision variable. It helps retailers determine whether the incremental gain from an action exceeds the incremental cost incurred. For instance, a retailer deciding whether to extend store hours will compare the additional revenue generated during extra hours with the additional labor, utility, and operational costs. If marginal revenue exceeds marginal cost, the decision is considered beneficial. This approach ensures efficient use of

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