Graphically, the area that represents the difference between the market price and the minimum price required to induce suppliers to produce a good is called
a. consumer surplus.
b. producer surplus.
c. marginal cost.
d. triangular arbitrage.
B
You might also like to view...
Economic behavior is always rational.
Answer the following statement true (T) or false (F)
A firm is concerned about the possibility of patent infringement and has hired an attorney to review patents. If the attorney is reviewing 100 patents and the marginal cost of reviewing the 100th patent is $50 and the expected marginal benefit of reviewing the 100th patent is $50, which of the following is true?
A) The firm is maximizing the total cost of infringement. B) The firm is minimizing the total cost of infringement. C) The firm's total cost of infringement will decrease if the number of patents reviewed decreases. D) The firm's total cost of infringement will decrease if the number of patents reviewed increases.
The social (or true) cost of producing a good is derived by
a. adding external cost to private cost b. subtracting private cost from external cost c. subtracting external cost from private cost d. measuring private cost alone e. measuring external cost alone
Which of the following would increase U.S. GDP?
a. Ford Motor Company begins to produce and sell cars in China. b. Mercedes-Benz begins to produce and sell cars in Mississippi. c. An American investor buys 100 shares of Ford stock. d. An American investor purchases 100 shares of Mercedes-Benz stock.