The law of diminishing marginal utility gives us insight into the downward-sloping demand curve because consumers are willing to pay a higher price for goods with high marginal utility.
Answer the following statement true (T) or false (F)
True
Marginal utility is high when goods are scarce. That corresponds to the top of the demand curve where a high price has a low quantity demanded.
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The shapes of the total product and marginal product curves are related because
a. an increase in total product pulls marginal product up. b. marginal product gives the slope of total product. c. marginal product increases as total product increases. d. the marginal product curve lies above the total product curve.
State legislators who wanted to eliminate state regulation of the trucking industry would be most likely to find support among
A) business owners who must pay higher prices for deliveries as a result of the regulations. B) owners and managers of large trucking concerns. C) owners of small trucking concerns. D) unions that represent truck drivers.
A price floor above the market clearing price typically results in I. an excess quantity supplied II. a shortage III. an excess quantity demand
A) I only B) II only C) III only D) II and III only
The level of an economic activity should be increased to the point where
a. Marginal benefits equal to zero b. Marginal costs of the investment are less than marginal benefits of the investment c. Marginal benefits are greater than marginal costs d. Marginal costs are equal to marginal benefits