The graph below represents the market for walnuts. Identify the values of the marginal benefit and the marginal cost at the output levels of 2,000 pounds, 4,000 pounds, and 6,000 pounds. At each of these output levels, state whether output is
inefficiently high, inefficiently low, or economically efficient.
What will be an ideal response?
Output level = 2,000 lbs: marginal benefit = $3.50, marginal cost = $2.50, output is inefficiently low.
Output level = 4,000 lbs: marginal benefit = $3.00, marginal cost = $3.00, output is economically efficient.
Output level = 6,000 lbs: Marginal benefit = $2.50, marginal cost = $3.50, output is inefficiently high.
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Which of the following shifts the supply curve for gasoline rightward?
A) a situation in which the quantity demanded exceeds the quantity supplied B) an increase in the price of gasoline C) a decrease in the price of a resource used to produce gasoline, such as crude oil D) an increase in the demand for gas-guzzling, sport utility vehicles
The distribution of income and wealth in colonial America was
(a) relatively equal to that of modern America. (b) relatively unequal to that of modern America. (c) unequal in roughly the same degree as that in modern America. (d) unequal, but the data are not good enough to allow a comparison with modern America.