Using a marginal revenue (MR)/marginal cost (MC) line graph, what is the point at which a monopoly will maximize its profits?
a. MR = MC
b. MR > MC
c. MC > MR
d. MC < MR
a. MR = MC
The profit-maximizing choice for the monopoly will be to produce at the quantity where marginal revenue is equal to marginal cost; that is, MR = MC.
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Status-quo bias is:
A. when people actively make decisions to change something, even if it is fairly difficult to do so. B. a type of mental barrier to saving. C. not overcome in the SMarT program because saving is the default option. D. when people have a negative view on the status quo.
Spot exchange can be inefficient in the presence of:
A. a complex contracting environment. B. opportunism. C. spot checks. D. None of the statements is correct.
Which of the following helps low-income countries grow rapidly relative to high-income countries?
a. Low-income countries are in a better position to save a larger share of their income. b. Low-income countries can employ technologies and practices that have been successful in high-income countries. c. Low-income countries generally have legal systems that protect property rights and enforce contracts in a more evenhanded manner. d. Low-income countries generally have more favorable weather conditions.
The property that implies that indifference curves are convex to the origin is:
A. completeness. B. more is better. C. diminishing marginal rate of substitution. D. transitivity.