Which of the following statements is true?
A. As consumption increases, total utility must increase.
B. Total utility increases initially and then decreases as marginal utility approaches zero.
C. If marginal utility is greater than zero, total utility is increasing.
D. If marginal utility is zero, total utility is at a minimum.
Answer: C. If marginal utility is greater than zero, total utility is increasing.
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The reason that the government offers inventors exclusive rights to their product for a period of time is to
A) promote innovation. B) increase profits of certain companies. C) maximize consumer utility. D) reduce market concentration.
An increase in the quantity of capital increases ________ and increase in the full-employment quantity of labor increases ________
A) the SAS and the LAS; only the SAS B) the SAS and the LAS; only the LAS C) the SAS and the LAS; the SAS and the LAS D) only the LAS; the SAS and the LAS
Whenever a firm can charge a price greater than marginal cost
A) the firm must be a monopolist. B) consumers have the ability to choose a close substitute. C) there is some loss of economic efficiency. D) the firm will earn economic profits.
[NeedAttention]
Exhibit 30-2
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