"If the marginal social benefit of a car exceeds the marginal social cost of a car, we are producing too many cars." True or false? Explain
Indicate whether the statement is true or false
False. If the marginal social benefit of a car exceeds the marginal social cost of a car, we can gain value by producing another car and we are losing value by not producing it. If the marginal social benefit exceeds the marginal social cost, producing another car yields a benefit that exceeds the cost of producing the car. So we are producing too few cars.
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List four of the Federal Reserve's key functions
What will be an ideal response?
Use Figure 13.2 which depicts a monopolist firm to help with the following question. Why would this firm not find it profitable to produce more than Qm or less than Qm?
What will be an ideal response?
A common response to stop a depreciation of a currency is to use contractionary monetary policy, which could lead to a recession
Indicate whether the statement is true or false
Suppose Gizmo Inc is willing to sell one gizmo for $10, a second gizmo for $12, a third for $14, and a fourth for $20, and the market price is $20 . What is Gizmo Inc's producer surplus?
a. $56 b. $24 c. $20 d. $10