Refer to the above figure. The market clearing price is
A) $2.
B) $6.
C) $8.
D) $10.
B
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Competition results in the efficient product mix because
A) producers are setting MRT equal to minus the price ratio while consumers are setting MRS equal to minus the price ratio ensuring that MRT will equal MRS. B) consumers are on the contract curve. C) the slope of the production possibility frontier will equal the slope of the contract curve. D) the distribution of the final output is Pareto efficient.
A change in a relevant factor other than the price of the good itself causes a ________ the demand curve, and a change in a good's own price causes a ________ the demand curve
A) shift of; shift of B) shift of; movement along C) movement along; shift of D) movement along; movement along
Compared with a perfectly competitive firm facing the same costs, long-run equilibrium for a monopolistically competitive firm will result in
A) a higher price and greater output. B) a lower price and less output. C) a higher price and less output. D) a lower price and greater output.
The slope of the consumption function is equal to: a. the MPC
b. the MPS. c. 1/(1 - MPC). d. MPC - MPS.