"The firm hires the factor up to the point where the value of the factor's marginal product is equal to the factor's price." This statement applies to which factor of production?

If the market price of a good does NOT include all of the costs and benefits that arise from the production or consumption of the good, then

A) the market is perfectly competitive. B) an externality is present. C) society is consuming and producing the optimal amount of the good. D) resources are properly allocated.

A decrease in supply will occur when

A) the supply curve shifts downward to the right. B) the supply curve shifts upward to the left. C) the demand curve shifts downward to the left. D) the demand curve shifts upward to the right.