When a competitive market maximizes economic surplus, it implies that the
A. quantity demanded is lower than the quantity supplied.
B. marginal benefit of having the product is greater than the marginal cost.
C. combined consumer and producer surplus is maximized.
D. buyers are getting the maximum consumer surplus from the product.
Answer: C
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Refer to Figure 11-1. Using the per-worker production function in the figure above, the largest changes in an economy's standard of living would be achieved by a movement from
A) A to B to C. B) C to B to A. C) B to C to D. D) D to C to B.
The Cambridge equation equates money demand as
A) a fraction of nominal GDP. B) a percentage of real GDP. C) a fraction of money supply. D) a ratio of spot exchange rates.
Which of the following industries would be considered to have a capital intensive production process?
A. Creating a painting. B. Farming in a rich country C. Creating a hand-crafted wine. D. Serving food at a restaurant.
When the real output of an economy is above its equilibrium output, _____
a. sales increase unexpectedly b. inventories begin to grow as output remains unchanged c. businesses will increase their level of production d. there will be a decrease in the stock of inventories