Suppose the socially-optimal quantity of good x is 2,500 units and the market-equilibrium quantity of good x is 3,000 units. When 2,500 units of good x are produced, the
a. external cost of good x exceeds the private value of good x.
b. external cost of good x equals the private value of good x.
c. social cost of good x exceeds the private value of good x.
d. social cost of good x equals the private value of good x.
d
Economics
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Firms in a monopolistically competitive market will advertise because
A) they want to differentiate their products. B) they want to increase the elasticity of the demand curve. C) of the significant differences in their product over their competitors. D) the elasticity for their product is inelastic.
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When demand falls, the price charged by a monopoly under an average-cost pricing policy will fall.
Answer the following statement true (T) or false (F)
Economics