Pete owns a shoe-shine business. His accountant most likely includes which of the following costs on his financial statements? (i) shoe polish (ii) rent on the shoe stand (iii) wages Pete could earn delivering newspapers (iv) interest that Pete's money was earning before he spent his savings to set up the shoe-shine business

In a situation in which internal costs differ from social costs, we say that there exists a(n)

A) welfare loss. B) welfare benefit. C) internality. D) externality.

If input prices rise as industry output expands, then a perfectly competitive firm's marginal cost and average cost curves will: a. shift upward

b. shift downward. c. not shift. As the firm increases production, however, costs increase as the firm moves upward to the right along these curves. d. not shift. As the firm increases production, however, costs decrease as the firm moves downward to the left along these curves.