Assuming no externalities exist, if a good's price is less than its marginal cost, then the benefits consumers derive are
A. greater than the cost of resources needed to produce it and less should be produced.
B. less than the cost of resources needed to produce it and more should be produced.
C. less than the cost of resources needed to produce it and less should be produced.
D. greater than the cost of resources needed to produce it and more should be produced.
Answer: C
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Based on the above figure, up to which level of output will Ike's Ice Cream Kitchen have increasing marginal returns?
A) only at 0 gallons B) up to 10 gallons C) up to 40 gallons D) up to 60 gallons
Refer to Table 3-2. The table above shows the demand schedules for caviar of two individuals (Ari and Sonia) and the rest of the market. At a price of $55, the quantity demanded in the market would be
A) 42 oz. B) 136 oz. C) 178 oz. D) 233 oz.
In a world of scarcity, there has to be some way to ration the available resources. According to economists, the most efficient use of available resources occurs when rationing occurs via
A) queuing. B) lotteries. C) political power. D) the price system.
The difference between the exports and imports of goods in a country is referred to as the
A) balance of payments. B) balance of trade. C) balance of power. D) exchange rate.