Is the equilibrium efficient?
a. Yes, since they are both maximizing the utility
b. No, since they could both get more utility
c. One should keep the house clean
d. None of the above
b
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The uncertainty costs of inflation cause ________ because ________
A) a decrease in investment and slower growth; people focus on the long run and not the short run B) an increase in investment and faster growth; people focus on the short run and not the long run C) a decrease in investment and slower growth; people increase their demand for money D) a decrease in investment and slower growth; people focus on the short run and not the long run E) an increase in investment and faster growth; people decrease their demand for money
Refer to Figure 12-11. Suppose the prevailing price is $20 and the firm is currently producing 1,350 units. In the long-run equilibrium, the firm represented in the diagram
A) will continue to produce the same quantity. B) will reduce its output to 750 units. C) will reduce its output to 1,100 units. D) will cease to exist.
Oligopoly: a. Meets the condition for allocative efficiency. b. Meets the condition for productive efficiency. c. Leads to slower technological progress
d. None of the above is true.
Refer to the graph shown. If the firm maximizes profit, the marginal cost of its product will be:
A. $6. B. $10. C. $8. D. $4.