Refer to the diagram, which pertains to a purely competitive firm. Curve C represents:

The economic theory of government predicts elected officials at the federal level will have incentives to act in ways that

A) cause inflation. B) increase uncertainty and the instability of total demand. C) secure short-term economic gains with deferred costs. D) result in all of the above. E) result in none of the above because they will usually want to be reelected.

How does marginal cost change as output increases (a) initially and (b) eventually?

What will be an ideal response?