How does competition ensure that the efficient product mix is attained?
What will be an ideal response?
In a competitive market, producers choose an output level where marginal cost equals price. Thus Px/Py = MCx/MCy. Each consumer maximizes her own utility subject to the given prices by setting MUx/MUy = px/py. Even though each is acting independently and in her own interest, the final outcome is that px/py = MRS = MRT, which is the condition for efficient product mix.
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Educating girls and women should reduce population growth because better-educated girls and women
a. will take better care of their children b. are more likely to practice contraception c. are more likely to want income from working rather than having additional children d. tend to want to spend more on fewer children rather than less on a greater number of children e. all of the above
Which of the following was not a result of the luxury tax imposed by Congress in 1990?
a. The larger part of the tax burden fell on sellers. b. A larger part of the tax burden fell on the middle class than on the rich. c. Even the wealthy demanded fewer luxury goods. d. The tax was never repealed or even modified.
A currency has depreciated in value if it takes more of a foreign currency to buy it
Indicate whether the statement is true or false
A short-run production function was estimated asQ = ?0.002L3 + 0.16L2At 20 units of labor, what is total product?
A. 62 B. 96 C. 41 D. 48 E. 20