According to the No Marginal Improvement Principle for Boundary Choices, if X* is a best choice, then:
A. if only a marginal increase in the activity level is possible, the MB ? MC at X*.
B. if only a marginal increase in the activity level is possible, the MB ? MC at X*.
C. if only a marginal decrease in the activity level is possible, the MB ? MC at X*.
D. MB = MC at X*.
A. if only a marginal increase in the activity level is possible, the MB ? MC at X*.
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In a contestable market with one firm in the market, the existing firm will
A) set its price equal to the monopoly price. B) set its price lower than the monopoly price. C) set its price higher than the monopoly price. D) have a demand curve that is horizontal at the price that will attract new firms to enter the market.
If the government levies a $500 tax per car on sellers of cars, then the price received by sellers of cars would
a. decrease by less than $500. b. decrease by exactly $500. c. decrease by more than $500. d. increase by an indeterminate amount.