Refer to the above figure. What is the socially optimal point of production?
A. P3 and Q2.
B. P1 and Q4.
C. P4 and Q1.
D. P1 and Q1.
Answer: A
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Why does a new hardcover Stephen King novel have a higher price than the paperback edition?
A) It costs more to produce. B) The elasticity of demand differs. C) The publisher is more greedy when marketing the hardcover edition. D) The publisher is a price searcher on the hardcover editions and a price taker on the paperback editions.
Suppose a firm uses 200 units of capital and 1,000 workers to produce 10,000 units of output. When the firm employs 3,000 workers and uses 600 units of capital, output increases to 45,000 units. This firm exhibits:
A. increasing returns to scale. B. decreasing returns to scale. C. constant returns to scale. D. diminishing marginal returns.
If a shirt manufacturer has a surplus of two shirts when they're priced at $14 each and a shortage of two shirts at $10 each, market equilibrium is likely at
a. $11 per shirt b. $12 per shirt c. $13 per shirt d. $15 per shirt
In the 1950s, the National Football League (NFL) had a virtual monopoly because _____________.
Fill in the blank(s) with the appropriate word(s).