In a competitive market, the demand curve shows the ________ received by consumers and the supply curve shows the ________
A) utility; average cost.
B) marginal benefit; marginal cost
C) economic surplus; opportunity cost
D) net benefit; net cost
Answer: B
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The bowed shape of the indifference curve reflects the consumer's
a. unwillingness to give up a good that he already has in large quantity. b. unwillingness to purchase a good that he already has in large quantity. c. greater willingness to give up a good that he already has in large quantity. d. greater willingness to purchase a good that he already has in large quantity.
If a positive permanent supply shock were to occur, the resulting equilibrium would be a:
A. higher level of output at lower prices. B. lower level of output and prices. C. higher level of output and prices. D. lower level of output at higher prices.
In Figure 21.4, a firm that produces between 600 and 800 units per period should choose a plant with a short-run average total cost function of
A. ATC2 only. B. ATC3 only. C. ATC2 or ATC3. D. ATC1 only.
If the slope of a demand curve is constant, then we know that
A) elasticity of demand is also elastic everywhere. B) elasticity of demand is constant and elastic. C) elasticity of demand is inelastic everywhere. D) elasticity of demand varies along the demand curve.