If a perfectly competitive firm achieves productive efficiency then
A) it will raise its price in order to earn an economic profit.
B) the price of the good it sells is equal to the benefit consumers receive from consuming the last unit of the good sold.
C) it is producing at minimum efficient scale.
D) it is producing the good it sells at the lowest possible cost.
Answer: D
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According to the above table, the value of MPS is
A) 0.9. B) 0.1. C) 0.2. D) increasing as real disposable income rises.
If the required reserve ratio is 15 percent, there is no currency drain, and banks loan all of their excess reserves, an increase in the monetary base of $20,000 leads to a total increase in the quantity of money of
A) $200,000. B) $133,333. C) $3,000. D) $20,000. E) $300,000.
The most commonly used metric for measuring the value of a national economy is:
A. gross domestic product, or GDP. B. gross national product, or GNP. C. gross national income, or GNI. D. gross domestic income, or GDI.
Suppose a legislation passed by the government encourages domestic oil exploration thereby reducing petroleum imports substantially. If the cost of production is uniform for all producers, which of the following will be observed in the petroleum market?
a. The world price of petroleum would decline. b. The domestic price of petroleum would decline. c. The world price of gasoline will remain unaffected. d. Crude oil consumption in the domestic and the world market would decrease.