If the difference between the marginal benefit and the marginal cost of a good is as large as possible,
A) resources are being used with maximum efficiency.
B) resources would create more value producing other goods and hence the production of this good should be decreased.
C) more of the good should be produced.
D) allocative efficiency has been attained.
E) Both answers A and D are correct.
C
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When the price of, say, a package of rice changes, what must the BLS do next?
A) immediately incorporate the new price into the CPI B) determine if the new price is consistent with other price changes for the period C) determine if the size, quality, weight, or packing of the rice has changed and adjust the price accordingly D) ignore the price change E) immediately incorporate the new price into the CPI only if the price has fallen
Suevania opens its doors to trade with Barvania. Barvania has a comparative advantage in the production of machinery. Hence, once trade occurs, Suevania's consumers will buy ________ machinery and pay ________ before
A) more; a higher price than B) more; a lower price than C) less; a higher price than D) less; a lower price than E) the same amount of; the same price as