The additional cost resulting from a small increase in some activity is called the:
A. opportunity cost.
B. marginal benefit.
C. marginal cost.
D. diminishing returns of the activity.
Answer: C
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The minimum point of a U-shaped curve,
A) is a point where the variable is neither increasing nor decreasing. B) has a slope equal to zero. C) has the maximum slope possible. D) Both answers A and B are correct. E) Both answers A and C are correct.
Which of the following firms is likely to have the highest market power?
A) A perfectly competitive firm B) A monopolistic competitor C) A monopoly D) An oligopoly with homogeneous products
If the equilibrium quantity is equal to the socially optimal quantity, one can infer that:
A. the supply curve for the activity is below the socially optimal supply curve. B. there is a negative externality associated with this good. C. there is no externality associated with this good. D. there is a positive externality associated with this good.
Which of the following is true under conditions of pure competition?
A. There are differentiated products B. The market demand curve is perfectly elastic C. No single firm can influence the market price by changing its output D. Each individual firm has the ability to set its own price