Below is a table showing the maximum amount five potential buyers are willing to pay for a car.
a) What is the quantity demanded if cars sell for $10,000 each?
b) Under conditions of perfect competition, how many cars are bought if the marginal cost of producing a car is $25,000?
c) How many cars are bought if the marginal cost of producing a car falls to $20,000?
Answer:
a) 5
b) 3
c) 4
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Economics can be described as the study of how people use ________ resources to satisfy ________ wants
A) unlimited; unlimited B) unlimited; limited C) limited; unlimited D) limited; limited
At the equilibrium point in a perfectly competitive industry, the total surplus (the sum of the consumer surplus and producer surplus) will be at its maximum.
Answer the following statement true (T) or false (F)
An unregulated paper firm that pours waste into a waterway
A. is producing at a quantity where marginal social cost is greater than marginal social benefit.. B. is producing at a quantity where marginal social benefit is greater than marginal social cost. C. is producing the social optimal quantity. D. has taken social cost into account.
Because a decrease in the nominal interest rate reduces the opportunity costs of holding money, the money demand curve:
A. slopes upward. B. shifts to the right. C. shifts to the left. D. slopes downward.