Why do economists mostly use optimization in differences, as opposed to optimization in levels?

What will be an ideal response?

For the sake of simplicity and intuition, economists mostly use optimization in differences. Optimization in differences is simple because everything else about the two alternatives that are being compared except the particular attributes that are different can be ignored. For example, suppose that two apartments are both near good restaurants, both have good access to public transportation, and both have a Laundromat down the street. The two attributes that are different, for instance rent and street noise, are compared while ignoring all the attributes that are the same about the two apartments.
Optimization in differences is also intuitive. When comparing two options, it makes sense to focus on what makes them different. Marginal analysis emphasizes this point, by comparing differences instead of levels.

Economics

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If the Herfindahl-Hirschman Index (HHI) among the firms in the long distance telecommunications market is equal to 855, when would the Federal Trade Commission probably challenge a proposed merger between any two of the firms?

A) It would challenge if the HHI would increase by more than 50 points. B) It would challenge if the HHI would increase by more than 100 points. C) It would challenge no matter what happened to the HHI because the market has so few firms. D) It would not challenge because the HHI is less than 1500.

Economics

A regulated natural monopoly that must set price equal to average cost will

a. suffer an economic loss b. earn a net economic profit c. earn a normal profit d. earn so little that it will close in the long run e. earn no profits of any kind

Economics