Which of the following offers the fullest explanation of why "price equals marginal cost" is the rule from marginal analysis that indicates the profit-maximizing output level?
a. If output were reduced from the profit-maximizing level, then the firm would be giving up marginal revenue that exceeds marginal cost, and thus reducing the level of profit.
b. If output were increased from the profit-maximizing level, then the firm would be gaining marginal revenue that is less than the marginal cost incurred in producing this additional unit, and thus reducing the level of profit.
c. Because the firm colludes with other similar firms to set price equal to marginal cost.
d. Both a. and b. above are correct.
d
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The advantages of emissions permits over taxes is/are:
a. it reduces undertainty about the quantity of pollution that will be emitted. b. environmental authorities decide on an emissions ceiling in advance of issuing permits. c. pollutants can be limited to levels which do not affect health. d. All of the above are correct.
Which statement is true?
A. Blacks have a lower poverty rate than Hispanics. B. Blacks have a poverty rate of about three times that of whites. C. Members of white families headed by females have a higher poverty rate than all black families. D. None of these statements are true.
If an independent variable in a multiple linear regression model is an exact linear combination of other independent variables, the model suffers from the problem of _____.
A. perfect collinearity B. homoskedasticity C. heteroskedasticty D. omitted variable bias
The firm's short-run supply curve begins at an output of
A. 0.
B. 40.
C. 45.
D. 50.