The minimum efficient scale of a firm:
A. is realized somewhere in the range of diseconomies of scale.
B. occurs where marginal product becomes zero.
C. is in the middle of the range of constant returns to scale.
D. is the smallest level of output at which long-run average total cost is minimized.
Answer: D
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Which of the following activities, if any, represents an external cost? a. The reduction in the incidence of chicken pox when children are inoculated against the disease. b. The damage to a person's health from secondhand smoke
c. The increase in local property values when the city creates a neighborhood park. d. The price you pay for the prime rib that you consume at a local restaurant.
Use the figure below, which shows a linear demand curve and the associated total revenue curve, to answer the question.
The price at which total revenue is maximized is $________.
A. 10 B. 20 C. 30 D. 15 E. 25