Suppose the price of a package of guitar strings is $5. If Mark's marginal cost of producing that package of guitar strings is $3, his producer surplus from that package of guitar strings is:
A. $0.
B. $1.
C. $2.
D. $3.
Answer: C
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According to this Application, home equity is the single largest component of net wealth for most families in the United States. As home equity falls
A) autonomous consumption will decrease, shifting the consumption function downward. B) the MPC will decrease, increasing the slope of the consumption function. C) autonomous consumption will decrease, shifting the consumption function upward. D) the MPC will decrease, decreasing the slope of the consumption function.
If an increase in the price of good X causes the demand curve for product Y to shift to the right, then X and Y are most likely to be which of the following?
a. Shoes and laces b. Tennis balls and tennis rackets c. Turkey and chicken d. Knives and forks e. DVD players and DVDs
In a barter economy that had no form of currency, how could interest exist?
Which of the following pairs of goods are substitutes?
a. baseballs; bats b. bicycles; bicycle helmets c. skim milk; ice cream d. domestic cameras; foreign cameras