If the quantity of corn is such that the marginal cost of corn is greater than the marginal benefit of corn, then I. there is a deadweight loss. II. more than the efficient quantity of corn is produced
A) Only I is correct.
B) Only II is correct.
C) Both I and II are correct.
D) Neither I nor II is correct.
C
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A demand relationship that is a vertical line up from the quantity axis is
A) perfectly elastic. B) unit-elastic. C) perfectly inelastic. D) somewhat elastic.
Output for a simple production process is given by Q = 2KL, where K denotes capital, and L denotes labor. The price of capital is $25 per unit and capital is fixed at 8 units in the short run. The price of labor is $5 per unit. What is the variable cost of producing 80 units of output?
A. $25 B. $85 C. $33 D. $200
If the United States consumption possibilities are greater than its production possibilities, then the United States must have
A. autarky. B. an open economy. C. a closed economy. D. protectionism.
Perfectly competitive industries are characterized by a homogeneous product.
Answer the following statement true (T) or false (F)