A competitive firm maximizes its profits (or minimizes is losses) by producing the quantity where the market price equals the firm's:
a. marginal cost.
b. average total cost.
c. average variable cost.
d. average fixed cost.
a
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Currently tire producers must receive a price of $50 per tire to produce 5000 tires. If the supply curve of tires is upward sloping, then to produce one additional tire, tire producers will need to receive a price of
A) $50. B) less than $50. C) more than $50. D) $0.
The marginal propensity to consume (MPC) is
a. the change in consumption divided by the change in disposable income b. total consumption divided by total disposable income c. the change in disposable income divided by the change in consumption d. total disposable income divided by total consumption e. the change in disposable income minus the change in consumption
Which is an example of a market failure?
A. The price of medical care has risen dramatically as a result of the introduction of sophisticated equipment and techniques. B. Polio shots and chest x-rays provide widespread benefits to the community as a whole as well as to the individuals who get them. C. Extensive decreases in the prices of electronic equipment resulted in large numbers of bankruptcies in the computer industry. D. There are not enough tickets available to concerts of extremely popular performers.
The above figure shows the marginal benefits and marginal costs of a college education. If colleges receive a $5,000 subsidy, then enrollment equals
A) 0. B) 10 million. C) 15 million. D) 25 million.