Production of a good produces pollution that is very damaging with each additional unit. A monopoly facing a very elastic demand curve will most likely produce
A) less than the social optimum of the good.
B) more than the social optimum of the good.
C) the social optimum of the good.
D) no externality.
B
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If a firm's marginal revenue from its 100th unit of output is $50 and the marginal cost from its 100th unit of output is $45, then in the short run this firm should:
a. increase its plant size. b. change its technology. c. produce more than 99 units of output. d. produce less than 100 units of output. e. shut down.
Pam is determined to lose 10 pounds and plans to adhere to a strict diet. But at the coffee break, she sees tray of glazed donuts and can't resist. She forgoes the plain bagel and devours a donut. Both the donut and bagel are priced at $0.50 . When her office mates tease her, she says matter-of-factly that
a. the MU/P of donuts is higher than that of the bagel, and that's that! b. the MU/P of bagels is higher than that of the donut, and that's that! c. the consumer surplus associated with bagels was higher than it was for donuts, making donuts more attractive d. when it comes to food, she's irrational e. the MU of losing 10 pounds is less than the MU of eating one donut.
Shaniqua sells life insurance and is considering buying a $60,000 Lexus for business purposes (thus, the expense reduces her taxable income). If Shaniqua is in the 40 percent marginal tax bracket, how much after-tax income will she have to give up in order to enjoy the Lexus?
a. $24,000 b. $36,000 c. $30,000 d. $84,000
Most spells of unemployment are short, and most unemployment observed at any given time is long-term
a. True b. False Indicate whether the statement is true or false