Use the above figure. At an output equal to "Q" the total cost for the firm will be the area
A. OQEB.
B. OQBC.
C. OQDC.
D. OQFA.
Answer: C
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Economic reasoning implies that economic agents will make decisions:
A) by random selection. B) by comparing the costs and benefits of various options. C) solely on the basis of tastes and preferences for various options. D) by replicating the choices made by other economic agents.
If the social cost of producing a good exceeds the private cost,
A) a negative externality exists. B) no externalities exist. C) a positive externality exists. D) the market is efficient.
Producer surplus is the price received ________ summed over the quantity sold
A) plus the consumer surplus B) multiplied by the quantity sold C) minus its marginal cost of production D) subtracted from the value of the good
For a monopolist that engages in price discrimination, when the price elasticity in market 1 is less (in absolute value) than in market 2, the optimal price in market 1 will exceed the optimal price in market 2
a. true b. false