Maintained and developed by the Department for Transportit was a cornerstone of UK transport appraisal in As a quick rule: When total benefits rise more than total costs, then the action is logical.
This is especially true when one type of physical outcome is sought, such as a reduction in energy use by an increase in energy efficiency.
This means that you are willing to pay more for the 1st drink than the next. Simply taking the sum of the materials and labor, in addition to the maintenance afterward, would give one the cost. While sometimes economics can seem obvious, it is important to first understand how a rational consumer should behave before seeing how we fail to meet that standard.
This means that a firm could continue to pump oil from wells for years after knowing that they will not fully recover their fixed costs.
We have just scratched the surface of it now, but will go more in depth in Topic 3. When total costs rise more than total benefits, then the action is illogical. By taking the sum of each user's willingness to pay, Dupuit illustrated that the social benefit of the thing bridge or road or canal could be measured.