When consumers pay only a fraction of the true cost of medical services, their demand increases. The marginal cost of producing these extra services

A) is greater than the marginal benefit consumers receive from them.
B) is less than the marginal benefit consumers receive from them.
C) is equal to the marginal benefit consumers receive from them.
D) is zero due to the insurance payments.


Answer: A

Economics

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What will be an ideal response?

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Answer the following statement true (T) or false (F)

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Suppose a perfectly competitive cotton farmer can produce 10 containers of cotton at an output at which marginal cost equals marginal revenue. The price per container of cotton is $100 and the average total cost is $75. What is the profit or loss that this cotton farmer is earning?

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Economics