Which is true of a purely competitive firm in long-run equilibrium?
A. Marginal cost equals marginal product.
B. Price equals marginal cost.
C. Average variable cost equals marginal cost.
D. Average fixed cost equals price.
Answer: B
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A firm charges each customer the highest price that customer will pay for the marginal unit under
a. perfect competition b. oligopoly c. monopolistic competition d. single-price monopoly e. perfect price discrimination
Consumer surplus measures the benefit to buyers of participating in a market
a. True b. False Indicate whether the statement is true or false
What is a fringe benefit?
a. a cash payment for casual work b. a business other than sales or marketing c. a payment other than wages or salaries d. an accounting term meaning profits
Producers will take external costs into account when:
A. they actually have to pay those costs. B. environmental groups apply sufficient pressure and generate negative press coverage. C. those costs are less than the benefits. D. those costs are less than the private costs.