Suppose that in the market for paper, demand is p = 100 - Q. The private marginal cost is MCp = 10 + Q. Pollution generated during the production process creates external marginal harm equal to MCe = Q. What is the competitive market level of output?
A) 20
B) 25
C) 30
D) 45
D
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A recent medical study shows that peanuts are one of the leading causes of high cholesterol. This would cause the demand for peanuts to
a. Shift to the left b. Shift to the right c. go down the demand curve d. not change
What has been the market outcome of government-enforced price floors for agricultural products?
A. A shortage of agricultural products has resulted. B. Not enough food has been produced. C. Farmers have been made worse off. D. A surplus of agricultural products has resulted.
Other things being equal, the monopolist will
A) hire more workers than if the industry were perfectly competitive. B) hire the same number of workers as a perfectly competitive industry would. C) hire fewer workers than if the industry were perfectly competitive. D) have lower profits than if the industry were perfectly competitive.
A production possibility frontier illustrates what ideas about economic scarcity?
A) that limits to production and consumption exist B) that tradeoffs are inevitable C) that resources must be used for production and consumption to take place D) all of the above