The figure above represents the competitive market for slices of key lime pie. If the production is 80 slices per day, the cost of the 80th slice is
A) less than anyone is willing to pay for it.
B) more than anyone is willing to pay for it.
C) equal to what someone is willing to pay for it.
D) indeterminant.
E) equal to the deadweight loss from the 80th slice.
B
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Which is not considered an “anticompetitive practice”?
A. Firms threaten to destroy competitors through innovation. B. A firm forces competitors to compete on prices. C. A firm prevents the entry of new rivals. D. Firms share intellectual property that may be helpful for research and development.
When what people pay does not necessarily reflect the real value they put on a good, it is likely that the:
A. good will be undersupplied. B. not a socially desirable good. C. free rider problem does not exist. D. good is easily excludable.
In building a model to analyze economic situations, one of the important assumptions is
A. cognitive dissonance. B. conversion abstraction. C. scarcity. D. ceteris paribus.
For a monopolist, marginal revenue ________ price.
A. is greater than B. always equals C. is less than D. is first greater than and then less than