In the above figure, the market is at its equilibrium. Area A + area B is equal to
A) consumer surplus.
B) total revenue.
C) total surplus.
D) marginal benefit.
E) producer surplus.
C
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Over the past decade technological improvements that have lowered the cost of producing an automobile have increased
A) both the supply and the demand for automobiles. B) the supply but not the demand for automobiles. C) the demand but not the supply of automobiles. D) neither the supply nor the demand for automobiles.
All of the following are reasons that health care costs have risen so much in the past few decades EXCEPT
A) the aging population. B) higher imports. C) new technologies. D) third party payments.
If an employer currently finds that the MRP of its labor resources equals $67, and the MFC equals $56, what would you advise the firm to do?
a. Stay at its current output level. b. Hire additional workers. c. Raise product prices. d. Reduce employment. e. Purchase new technology.
Which of the following statements about Coasian reasoning is true?
a. Coasian reasoning lacks symmetry, it does not provide a starting point for negotiations toward an efficient outcome. b. Coasian reasoning emphasizes on the benefits received by the person having more rights compared to the others in the group. c. Coasian reasoning explains how the costs and benefits of a transaction are distributed among the parties. d. Coasian reasoning provides a starting point for negotiations toward an efficient outcome, if the cost of negotiation is low.