If substantial economies of scale exist, setting price = MC will
a. result in a loss for the firm
b. result in an excess profit earned
c. yield a normal profit
d. cause the firm to produce more than the optimal number of goods
e. cause the firm to charge lower than the optimal price
A
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If marginal utility becomes negative for the first time, which of the following is true? a. Total utility is growing steeply
b. Total utility begins to decline. c. A rational consumer would never knowingly pay a positive price for these units of the good or service generating negative marginal utility. d. Total utility equals marginal utility. e. Both b. and c. above are correct.
The number of Compact Discs purchased by a consumer depends on the price of the discs as well as the prices of all other goods purchased
a. True b. False Indicate whether the statement is true or false