If the minimum efficient scale in woodstove production is 100,000 units per year,
a. the average cost of producing 50,000 stoves is greater than the average cost of producing 100,000
b. the average cost of producing 50,000 stoves is equal to the average cost of producing 100,000
c. the total cost of producing 50,000 stoves is greater than the total cost of producing 100,000
d. the firm should not produce more than 100,000 woodstoves
e. MC exceeds AC at 100,000 stoves
A
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Absent any violations of the first welfare theorem, the competitive market production level of a good will be the same as that chosen by a social planner whose goal includes (but is not necessarily limited to) efficiency.
Answer the following statement true (T) or false (F)
With perfect price discrimination, each consumer is charged the marginal value of each unit consumed
a. True b. False
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