In Figure 1.6, at which of the following points would the opportunity cost of producing one more SUV be highest?
A. A.
B. B.
C. C.
D. F.
Answer: D
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All firms can increase profits using price discrimination
A) True, because market demand curves are downward sloping B) True, because firms can sell different versions of a product that is just right for an individual consumer C) False, because consumers aren't forced to buy a firm's products D) False, because some firms are in competitive markets
Suppose Arf n' Barf restaurant has a monopoly on restaurant food in a certain small town. Their rent, which is one of several fixed costs they pay whether they sell food or not, has gone up. In the short run, the Arf n' Barf should
a. pay the higher rent and increase menu prices b. pay the higher rent and leave menu prices unchanged c. pay the higher rent and lower prices d. go out of business e. shut down
Which of the following is not an obstacle to development?
A. Overpopulation B. Excessive investment C. Political instability D. Corruption
A monopolistically competitive firm is producing at an output level in the short run where average total cost is $4.50, price is $4.00, marginal revenue is $2.50, and marginal cost is $2.50. This firm is operating:
A. at the break-even level of output in the short run. B. at an efficient level of output in the short run. C. with a loss in the short run. D. with a profit in the short run.