The principle of diminishing sensitivity holds that:
A. the marginal impact of enlarging a change from the status quo declines with the size of the change.
B. the marginal impact of enlarging a change from the status quo increases with the size of the change.
C. the total impact of enlarging a change from the status quo declines with the size of the change.
D. the total impact of enlarging a change from the status quo increases with the size of the change.
A. the marginal impact of enlarging a change from the status quo declines with the size of the change.
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In the above table, if the firm produces 2 units of output, it will
A) make an economic profit of $9. B) make an economic profit of $60. C) incur an economic loss of $9. D) incur an economic loss of $60.
The above figure shows the market for a particular good. If the market is controlled by a perfect-price-discriminating monopoly, compared to a perfectly competitive market, the change in producer surplus is
A) B + C. B) D + E. C) A + B + C. D) A + B + C + D + E.