Allocative efficiency means that
a. firms have maximized production
b. all mutually beneficial trades have taken place
c. the next unit sold will increase total surplus
d. producer surplus is maximized
e. no mutually beneficial trades have occurred
B
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If government uses a pollution tax to control pollution, the tax should be set
A) equal to the private cost of production created by the activity. B) equal to the external cost of production created by the activity. C) equal to the social cost of production created by the activity. D) at the amount that will eliminate the pollution completely.
The equation Y = A is known as the ________
A) Cobb-Douglas production function B) labor supply curve C) marginal product of labor D) capital-to-employment function
According to estimates by Richard Vedder, rates of exploitation for slaves:
a. are similar to those of antebellum manufacturing workers. b. indicate that slaves received nearly the full marginal value product of their labor. c. equaled 50-65 percent of their value marginal product. d. cannot be determined due to inadequate data on maintenance costs of adult slaves.
Given the scenario described, if the market price of hammers increased from $6 to $7:
Assume there are three hardware stores, each willing to sell one standard model hammer in a given time period. House Depot can offer their hammer for a minimum of $7. Lace Hardware can offer the hammer for a minimum of $10. Bob's Hardware store can offer the hammer at a minimum price of $13. A. total producer surplus would increase. B. total producer surplus would remain unchanged. C. total producer surplus would decrease. D. total producer surplus cannot be determined with the information given.