Efficiency in a market occurs when the production of the good is such that
A) marginal benefit exceeds marginal cost.
B) marginal benefit equals marginal cost.
C) marginal benefit is lower than marginal cost.
D) the marginal cost stops increasing.
E) marginal benefit exceeds marginal cost by the maximum amount possible.
B
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In a market system, the major coordination tasks are carried out
A. with the approval of central planners. B. as part of the regular appropriation process of Congress. C. irregularly by the major corporations. D. automatically by the market mechanism.
Marginal cost is the opportunity cost
A) that your activity imposes on someone else. B) that arises from producing one more unit of a good or service. C) of a good or service that exceeds its benefit. D) of a good or service divided by the number of units produced.
The goals of charitable organizations are inevitably inconsistent with the principles associated with profit maximization
Indicate whether the statement is true or false
Market clearing prices in a market system act as
A) a signaling device. B) a direct measure of resource costs. C) a way for producers to advertise. D) a legally determined rationing device.