Increasing marginal opportunity cost implies that
A) the more resources already devoted to any activity, the payoff from allocating yet more resources to that activity increases by progressively smaller amounts.
B) the more resources already devoted to any activity, the benefits from allocating yet more resources to that activity decreases by progressively larger amounts.
C) that rising opportunity costs makes it inefficient to produce beyond a certain quantity.
D) the law of scarcity.
Answer: A
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If a competitive market operates perfectly, it relies on
A) the number of people buying goods. B) the laws of supply and demand. C) how much people are willing to pay for the products. D) how many products can be produced for sale.
Suppose the Fed changes the interest rate in an attempt to raise planned investment. But in spite of this, planned investment remains unchanged. The most likely explanation is that
A) we have moved downward along an unchanged rate-of-return line. B) we have moved upward along an unchanged rate-of-return line. C) the rate-of-return line has shifted to the left. D) the rate-of-return line has shifted to the right.
Firm A producing one good acquires another firm B producing another good. Price elasticity of demand for Firm A's good is -1.8 and Firm's B is -1.8 . Holding other things constant and assuming both goods are substitutes, the acquiring firm should
a. Raise prices on both goods with a larger increase in Firm A's good b. Raise prices on both goods with a larger increase in Firm B's good c. Raise prices on both goods by the same amount d. Lower prices on both goods
For firms that sell one product in a perfectly competitive market, the market price:
A. can be influenced by one firm's output decision. B. is equal to the average total cost of a firm. C. is taken as a constant by individual firms. D. is higher than the marginal revenue of a firm