Efficiency in a market is achieved when
a. a social planner intervenes and sets the quantity of output after evaluating buyers' willingness to pay and sellers' costs.
b. the sum of producer surplus and consumer surplus is maximized.
c. all firms are producing the good at the same low cost per unit.
d. no buyer is willing to pay more than the equilibrium price for any unit of the good.
b
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If the growth rate of the money supply were 4% and the growth rate of the velocity of money were 2%, then which of the following could be a point on the aggregate demand curve?
A. Inflation of 3% and real growth of 3% B. Inflation of 6% and real growth of 6% C. Inflation of 4% and real growth of 4% D. Inflation of 2% and real growth of 2%
Marginal revenue for a single-price monopolist is
A) less than the market price. B) equal to the market price. C) greater than the market price. D) equal to zero for all levels of output.