You observe that at your current production of rutabaga, the average total cost of producing rutabaga is $1 and the marginal cost of producing rutabaga is $2. What should always happen if you increase rutabaga production?
A. Marginal cost will fall.
B. Average total cost will rise.
C. Average total cost will fall.
D. Both Marginal cost will fall and Average total cost will rise are correct.
Answer: B
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A rent ceiling set below the equilibrium rent
A) ensures the availability of enough low-rent apartments in a city. B) results in all renters and potential renters being better off. C) creates a situation in which the quantity demanded of housing is greater than quantity supplied. D) ensures that landlords earn a reasonable rate of profit on apartments. E) eliminates discrimination by landlords.
Assume that the Cambridge k = 0.2. If income increases by $20,000, the demand for money will change by
A) $20,000. B) $10,000. C) $5,000. D) $4,000.
. Jaime’s cross price elasticity of science fiction and mystery novels is -4. This means that the novels are
a. compliments. b. normal. c. substitutes. d. inferior.
________ is a situation in which a firm or a player in game theory chooses the best strategy given the strategies chosen by others
a. Nash equilibrium b. Dominant-strategy equilibrium c. Prisoner's dilemma d. Tit-for-tat