Consumers are willing to purchase a product up to the point where
A) the marginal benefit of consuming the product equals the area below the supply curve and above the market price.
B) the marginal benefit of consuming a product is equal to its price.
C) the marginal benefit of consuming the product is equal to the marginal cost of consuming it.
D) the consumer surplus is equal to the producer surplus.
B
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The table above shows the demand and costs for a single-price monopolist. The firm can maximize its profit by setting its price at
A) $30 per unit. B) $35 per unit. C) $40 per unit. D) $45 per unit.
The effective rate of protection measures
A) the "true" ad valorem value of a tariff. B) the quota equivalent value of a tariff. C) the efficiency with which the tariff is collected at the customhouse. D) the protection given by the tariff to domestic value added. E) the difference between domestic and foreign prices of the import.
Financial intermediaries are able to exploit economies of scale since
A) the equipment or expertise necessary for one transaction can be applied to other transactions. B) they have special licenses needed to perform financial transactions. C) financial markets fail to do so. D) they can reduce transactions cost, but not information costs.
Assume the short-run average total cost for a perfectly competitive industry decreases as the output of the industry expands. In the long run, the industry supply curve will:
A. have a positive slope. B. have a negative slope. C. be perfectly horizontal. D. be perfectly vertical.