Considering all costs of production, the marginal cost of producing a hot dog is $1.00. The price of a hot dog is $1.50. Thus, the producer surplus from this hot dog is
A) $1.50.
B) $1.00.
C) $.50.
D) Zero, because $1.50 is the most anyone would pay for a hot dog.
C
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Refer to Figure 13-13. If the diagram represents a typical firm in the market, what is likely to happen to its average cost of production in the long run?
A) It will probably fall since the firm must be cost efficient to remain competitive. B) It will probably rise since the firm will be producing less than its current amount. C) It will probably rise since its long-run demand is likely to be higher. D) It will probably fall since the firm will be selling less than its current amount.
Which of the following categories accounted for the third largest percentage of total federal government expenditures?
a. Education and health. b. National defense. c. Income security. d. Interest on the national debt.