If the price of a commodity is above marginal cost, then the economy will tend to
a. overproduce the item.
b. underproduce the item.
c. produce the optimal amount of the item.
d. overproduce and underproduce the item cyclically.
b
Economics
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In the above figure of a monopolistically competitive firm, the area of economic profit is
A) ADB. B) ABC. C) P2AD P4. D) P2FEP5.
Economics
The total social cost of production is equal to
A) external cost minus internal cost. B) internal cost minus external cost. C) external cost plus internal cost. D) internal cost plus opportunity cost.
Economics