Matt estimates the marginal benefit of eating one slice of pizza at $3. The marginal benefit of the 2nd slice is $2, the marginal benefit of the third slice is $1, and the marginal benefit of the 4th slice is $0. If the price is $1.50 per slice, to maximize his net benefit Matt should eat:
a. "1 slice."
b. 2 slices.
c. 3 slices.
d. 4 slices.
Ans: b. 2 slices.
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Entry into the information technology industry becomes more attractive the more firms there are because of the increased availability of already trained workers. Given this trend, it appears that information technology is
a. an increasing-cost industry. b. a constant-cost industry. c. a decreasing-cost industry. d. a government subsidized industry.
Kris wants to purchase a house. She buys newspapers to read the classified advertisements and spends her evenings with realtors looking at houses. Kris has incurred the ________ costs of making a purchase
A) transactions B) market C) buying D) scale
Monopoly powers given to domestic utility companies to create economies-of-scale might unintentionally
A) be an obstacle to increased international trade. B) be useful for the creation of a comparative advantage for the domestic country. C) not be used for rent-seeking behaviors. D) be a positive externality for the world as a whole. E) None of the above.
If in a market the last unit of output was sold at a price higher than marginal cost,
A) producers are better off producing more. B) consumers are better off if less of the product is sold. C) social welfare is not maximized. D) the unit increased total profit.