Final answer:
In business, a firm will purchase a resource if the benefit associated with the purchase is greater than or equal to its cost. This is known as the cost-benefit analysis.
Step-by-step explanation:
In business, a firm will purchase a resource if the benefit associated with the purchase is greater than or equal to its cost. This is known as the cost-benefit analysis. When a firm evaluates whether to purchase a resource, it considers the potential benefits or advantages that the resource can bring, such as increased productivity, higher profits, or improved efficiency. If the benefits outweigh the costs, the firm will make the purchase.
For example, if a firm is considering buying a new machine for production, it will compare the cost of purchasing and maintaining the machine with the potential benefits it can provide, such as faster production time, better quality output, or cost savings in the long run. If the expected benefits are equal to or greater than the cost of the machine, the firm will decide to purchase it.