If a firm is producing a given level of output in a technically efficient manner, then it must be the case that
A. this is the lowest cost method of producing that output.
B. this output level is the most that can be produced with the given levels of inputs.
C. each input is producing its maximum marginal product.
D. both a and c
E. all of the above
Answer: B
You might also like to view...
The law of demand illustrates that as
a. price decreases, demand increases. b. price increases, quantity demanded increases. c. price decreases, quantity supplied increases. d. price decreases, quantity demanded increases.
The total revenue curve for a perfectly competitive firm
a. is a vertical line intersecting the horizontal axis b. is a horizontal line intersecting the vertical axis c. starts part way up the vertical axis, then slopes upward in a backwards-S curve d. is a straight line starting from the origin and sloping upward e. starts at the origin, sloping upward at first and then sloping downward
The circular flow model shows that: a. households are on the demand side of the resource market
b. firms are on the demand side of both the product and resource markets. c. households are on the supply side of the resource market and the demand side of the product market. d. firms and governments are on the supply side of the loanable funds market. e. governments are on the demand side of the product market and the supply side of the resource market.
Along a straight-line demand curve, elasticity:
A. rises as price rises. B. declines as price rises. C. is always zero. D. is equal to slope.