If a perfectly competitive firm is producing 1,500 units and, at the 1,500th unit, the difference between marginal revenue and marginal cost (MR - MC) is negative, which of the following is true?
A) The firm should increase production to maximize profit.
B) The 1,500th unit costs less to produce than the firm earns in revenue.
C) The firm is maximizing profit.
D) The firm should decrease production to maximize profit.
D) The firm should decrease production to maximize profit.
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A benevolent social planner would prefer that the output of good x be decreased from its current level if, at the current level of output of good x,
a. social value = private value = private cost < social cost. b. private cost < social cost = private value = social value. c. social cost = private cost = private value < social value. d. social cost = private cost = private value = social value.
In reality, all economic systems are
A. mixed. B. capitalistic. C. democratic. D. socialistic.