Assume that the marginal cost of producing steel does not include the cost of the damage to the environment as a result of pollution. By producing where P = MC, the firm will be producing
A. the efficient amount of steel.
B. more than the efficient amount of steel.
C. a zero quantity of steel.
D. less than the efficient amount of steel.
Answer: B
You might also like to view...
What is true of marginal cost when marginal returns are increasing?
a. It is negative and increasing. b. It is negative and decreasing. c. It is positive and increasing. d. It is positive and decreasing. e. It is positive and has a constant slope.
If foreign interest rates are high relative to those in the U.S. demand for dollars will:
A. increase as investors sell their currency to buy dollars for investment. B. decrease as investors sell their dollars to buy foreign currency for investment abroad. C. increase as investors sell their dollars to buy foreign currency for investment. D. decrease as investors sell their currency to buy dollars for investment.
Which of the following is not a result of imposing a rent ceiling?
A) Some consumer surplus is converted to producer surplus. B) There is a reduction in the quantity of apartments supplied. C) There is an increase in the quantity of apartments demanded. D) The marginal benefit of the last apartment rented is greater than the marginal cost of supplying it.
Fred has already paid $50 for a ticket to a football game that is sold out. Paul has offered Fred $120 for his ticket. That is the highest offer Fred has received for the ticket. Assume the value of Fred's time given up to go the game is $0. What is the opportunity cost of going to the game for Fred?
a) $170 b) $120 c) $70 d) $50 e) $0