If a perfectly competitive firm can sell each unit of output for $9, and the marginal cost of the last unit produced is $8.50, then the:
A. firm should lower its output level in order to increase profits.
B. extra benefit of the last unit produced is less than the extra cost.
C. firm is earning an average profit of $0.50.
D. extra benefit of the last unit produced is greater than the extra cost.
Answer: D
You might also like to view...
Henry deposits $2,000 in currency in the First Street Bank. Later that same day Jane Harris negotiates a loan for $5,400 at the same bank. After these transactions, the supply of money has
A. decreased by $3,300. B. increased by $2,100. C. increased by $3,300. D. increased by $5,400.
"Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes the bubble on a whirlpool of speculation.". This is an apt quote by
a. J. M. Keynes about the stock market crash b. Alan Greenspan about the Asian markets c. Paul Volcker about runaway inflation d. Franklin Roosevelt about railroad stock speculators e. Bill Clinton about his balanced budget
Which of the following is not an obstacle to development?
A. Overpopulation B. Excessive investment C. Political instability D. Corruption
(Consider This) Past costs that are not affected by new decisions are known as:
A. variable costs. B. fixed costs. C. marginal costs. D. sunk costs.