At a Competitive Equilibrium, If There Are No Taxes, Subsidies

question 3

Multiple Choice

At a competitive equilibrium, if there are no taxes, subsidies, price regulations, quantity regulations, or externalities,

• A) both the marginal benefit and the marginal cost of the last unit produced equal zero.
• B) the marginal benefit is less than the marginal cost.
• C) the marginal benefit is greater than the marginal cost.
• D) the marginal benefit is greater than the marginal cost by as much as possible.
• E) resource use is efficient.

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Definitions:

Receiver Division

The unit within a company that receives goods or services from another segment of the company, often in a transfer pricing scenario.

Transfer Price

The price charged for goods or services transferred between departments or divisions of the same company or between affiliated companies.

Pump Division

The pump division within a company refers to the segment that specializes in the production and development of pump units and systems.

Transfer Price

The cost at which products or services are exchanged between departments or divisions within the same organization.