Jessica's marginal cost for producing a pitcher of lemonade is $0.25. Therefore, $0.25 is her:
A. equilibrium price.
B. reservation price.
C. producers surplus.
D. marginal revenue.
Answer: B
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Due to the recent increase in the price of natural gas, the quantity of coal demanded by electric power generation plants has increased. Based on this information, coal and natural gas are:
A) complements. B) substitutes. C) independent goods. D) none of the above
Terence has $50 per week to spend on Subway sandwiches and milkshakes. The price of a Subway sandwich is $5 and the price of a milkshake is $4. He buys 6 sandwiches and 5 milkshakes. The marginal utility of the 6th sandwich = 25 and the marginal utility
of the 5th milkshake = 24. Which of the following is true? A) He is not maximizing his utility and should buy more milkshakes. B) He is maximizing his utility. C) He is not maximizing his utility and should buy more Subway sandwiches. D) He is not maximizing his utility because he is not spending all of his income.
Prices of farm products are
A. The result of government-enforced price ceilings in the farming industry. B. Subject to short-term swings. C. Below the market equilibrium price because of price support programs. D. Very stable in the short run.
Every point on a linear demand curve has the same elasticity.
Answer the following statement true (T) or false (F)