Refer to Figure 17.1 What output matches MR = MC?
A. 8 units
B. 5 units
C. 6 units
D. 7 units
Answer: D
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The price of a seller's product in perfect competition is determined by
A) the individual seller. B) the individual demander. C) market demand and market supply. D) a few of the sellers.
If an economy is producing a combination of goods that places it on the production possibilities curve, then it has:
A) economic growth. B) full employment. C) inefficiency. D) idle factors of production.
If prices are not stable:
A. money performs better as a unit of account. B. prices become highly useful for conveying information. C. money becomes less useful as a store of value. D. it may be an inconvenience, but resources are still allocated efficiently.
The self-correcting property of the economy means that output gaps are eventually eliminated by:
A. increasing or decreasing potential output. B. government policy. C. decreasing inflation only. D. increasing or decreasing inflation.