If the marginal social cost of producing a ton of cement is $4,000 and the marginal private cost is $3,500, then the
A) marginal benefit of a ton of cement will equal $4,000.
B) total cost of producing a ton of cement is $7,500.
C) marginal external cost of producing a ton of cement is $500.
D) marginal external cost of producing a ton of cement is $7,500.
E) marginal external cost of producing a ton of cement is $4,000.
C
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Which of the following statements about the above figure is TRUE?
A) Point A is equally preferred to point C. B) Point B is equally preferred to point C. C) Point C is preferred to point A. D) Point A is preferred to point C.
If Happy Feet chooses to No Ad and Best Nails then chooses to Ad, Happy Feet earns ________ million in net profit and Best Nails earns ________ million.
Happy Feet wants to prevent Best Nails from entering the nail salon market. The above game tree illustrates the different strategies and corresponding payoffs for the two firms. Both Happy Feet and Best Nails have the same strategies of advertising (Ad) or not advertising (No Ad). The payoffs represent net profit in millions.
A) $1; $4 B) $5; $1 C) $4; $1 D) $2; $3
Refer to the above figure. Suppose the marginal benefit and the marginal cost curves of pollution abatement are normally shaped. Suppose the equilibrium is for a factory in Los Angeles
What would happen if the same factory were in the middle of Nevada? A) The marginal cost curve (1 ) would shift to (2 ) and there would be no difference in the level of abatement. B) The marginal cost curve (2 ) would shift to the left and there would be less abatement in Nevada. C) The marginal benefit curve (4 ) would shift to the left and there would be less abatement in Nevada. D) The marginal benefit curve (2 ) would shift to the right and there would be more abatement in Nevada.
In Connecticut, the apple market is perfectly competitive. Suppose that consumer tastes change so that the market demand for apples increases. In that case, the demand curves faced by individual firms will
a. not change b. become less elastic c. shift upward d. shift leftward e. shift downward