Refer to Figure 11-18. Starting from point E, a movement along the isocost to point F
A) decreases output but not the total cost of production.
B) decreases both the total cost of production and output.
C) decreases the total cost of production but not output.
D) increases the total cost of production and decreases output.
A
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If the production of a good created both external costs and external benefits, but the external costs were greater, without government intervention, a market economy will:
a. not produce the product at all b. overproduce the product. c. underproduce the product. d. produce the optimal amount of the product.
After participating members of a cartel form an agreement on common prices and output quotas, then an individual firm can increase its own profits by
A) increasing production. B) increasing prices. C) leaving the cartel. D) incurring higher input costs.