In a market system, prices are used to coordinate economic activity
a. True
b. False
Indicate whether the statement is true or false
True
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Resource use is allocative efficient
A) when it is not possible to produce more of one good. B) when we produce goods and services that we value most highly. C) when most resources are fully employed. D) at any point on the PPF. E) at all points either on or within the PPF because all these production points are attainable.
Using the data in the table above, when the price of a skirt rises from $20 to $35, what is the price elasticity of demand? (Use the midpoint method.)
A) 0.33 B) 0.25 C) 1.00 D) 1.33 E) 3.00
If the marginal cost curve of all identical firms in a perfectly competitive industry are horizontal at the same per-unit cost, then the market's consumer surplus equals the area
A) beneath the demand curve and above the marginal cost curve. B) above the demand curve and beneath the marginal cost curve. C) below the marginal cost curve. D) above the demand curve.
Economies of scale: a. are the result of a diminishing marginal product
b. pertain to the long run only. c. refer to the increase in output that results from the increased utilization of a single input. d. imply that the average total cost curve will fall continuously as output increases in the short run.