Electric generator companies did not raise their prices when there was a huge demand for their products, due to a power shortage. The companies decided against a price rise because they were
A. concerned about peoples' welfare.
B. concerned about being sued by consumer activists.
C. concerned about political backlash.
D. concerned about reputation and future demand.
Answer: D
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The above figure shows the marginal social benefit and marginal social cost curves of chocolate in the nation of Kaffenia. When the marginal social benefit is equal to the marginal social cost of chocolate in Kaffenia
A) either 100 pounds or 250 pounds can be produced each day. B) no chocolate is produced. C) 150 pounds will be produced each day. D) any quantity up to 150 pounds will be efficient.
Which central coordination task has claimed the most attention of central planners?
A. Output selection B. Production planning C. Distribution D. Rationing
If a firm's total fixed costs are $30, the firm's marginal cost of producing the first unit of output is $30, and the average total cost of producing two units of output is $42, the marginal cost of the second unit of output is:
A. $84. B. $54. C. $42. D. $24.
Refer to the above figure. Other things being equal, when the government imposes a price floor at P2, then we would expect
A. price to decline until an equilibrium is achieved at P0. B. consumers to bid against each other for goods and force the price even higher. C. a surplus will occur. D. the quantity demanded is Q2.