Imagine you own a machine that produces perfectly authentic and legal $100 bills. You would use this machine until:

a. the bills became worthless.
b. the total cost began to fall.
c. the marginal cost was $100.
d. the variable cost began to rise.
e. the marginal revenue began to fall.

c

Economics

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The maximum price that a buyer is willing to pay for a good measures his

A) producer surplus. B) willingness to pay. C) consumer surplus. D) marginal benefit.

Economics

The perfectly competitive model makes a lot of fairly unrealistic assumptions. Why do economics text books still talk a lot about this model?

A) Many markets are close to being perfectly competitive. B) It is an important model to use as a benchmark to compare other markets structures to. C) Perfectly competitive markets maximize societal welfare. D) All of the above.

Economics