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- What is the marginal revenue gained when one more unit of output is sold? The price at which the extra unit is sold but adds the rise in revenue of the previous units that could have been sold at a higher price O a. O b. The price of the unit of output sold minus the production cost of that unit The price of the unit of output sold O c. Od. The price at which the extra unit is sold but subtracts the drop in revenue of the previous units that could have been sold at a higher priceEconomic profit is Select one: O a. O b. equal to accounting profit equal to total revenue minus explicit costs O c. equal to total revenue minus both implicit and explicit costs O d. always greater than accounting profitImagine a firm in a competitive market comes up with a new production method, which halves its marginal cost at all levels of Q. Fixed costs are unaffected. Which of the following statements are true? O a. The firm's AC at all levels of Q would be lower. O b. The firm would extract an innovation rent from selling at the market price with lower costs. Oc. The firm's point of minimum AC would be a higher level of Q. O d. The innovation would immediately cause the market price to drop.
- QUESTION 18 The law of diminishing returns indicates that O A. the demand for goods O C. as extra units of a variable O D. beyond some point, the extra utility O B. because of economies and diseconomies of scale, a competitive resource are added to a fixed resource, marginal product will decline beyond some point derived from additional units of a produced by purely competitive industries is downwarde sloping product will yield the consumer firm's long-run average total cost curve will be U-shaped smaller and smaller extra amounts of satisfactionResource allocative efficiency exists for a perfectly competitive firm because O a. price equals average total cost and the firm equates marginal revenue and average total cost to maximize profits. O b. price is less than marginal revenue and the firm equates marginal cost and marginal revenue to maximize profits. c. price is greater than marginal revenue and the firm equates marginal revenue with average total cost to maximize profits. O d. price equals marginal revenue and the firm equates marginal revenue and marginal cost to maximize profits. 0= Icon KeyIf a firm is producing where MR > MC O a. the revenue gained by producing one more unit of output is less than the cost incurred by doing so. O b. the firm is already maximizing profits because revenue is being increased by more than costs. the revenuesgained by producing one more unit of output exceeds the cost incurred by doing so. O d. the revenue gained by producing one more unit of output equals the cost incurred by doing so.
- Suppose that firm is currently producing 15 units of a good at a market price of $12. The firm has a MC of $12 and an average total cost of $8. What is the firm's economic profit and is it maximizing profits? O $0, yes O $60, no $60, yes O $0, no Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.The profit (in dollars) from the sale of x lawn mowers is II(x) = 70 x -0.07 x2 - 750. The correct interpretation of the marginal average profit of producing 40 mowers is Select one: O a. Can not tell. O b.At production level of 40 mowers a unit increase in production will increase the total profit by $0.40 per mower. O c. At production level of 40 mowers the average profit is increasing at a rate of $0.40 per mower. O d. At production level of 40 mowers the average profit is $0.40 per mower.Consider the following graph: Producer surplus is: O A. revenue plus variable cost. O B. revenue minus variable cost. OC. the area below the market price up to the amount produced. D. the area above the supply curve up to the amount produced. 10- 9- 8- 7- 6- P 4- 3- 2- 1- 0- 0 Price Quantity S = MC 10 Q
- To sell one more unit of output, the seller must make one more and sell it for O less than the price at which the last unit sold the marginal revenue O the cost of the resources used to produce it O the same price as the last unit soldThe profit maximizing rule states that a business maximizes profits when marginal cost equals Select one: O a. Variable costs O b. Fixed cost O c. Marginal revenue O d. None of the aboveStuff, Incorporated is a firm with a total revenue of $1,000, marginal cost of $5, and average variable cost of $4. Both the output and input markets are perfectly competitive and Stuff, Inc. is in long run equilibrium. Stuff, Inc.'s output and total fixed costs must be equal to which of the following? O Output 200; Fixed Cost $200 O Output 200; Fixed Cost $400 O Output 200; Fixed Cost $800 O Output 250; Fixed Cost $800 O Output 250; Fixed Cost $400