In a Competitive Market with No Externalities

question 31

Multiple Choice

In a competitive market with no externalities,

• A) at the equilibrium price, marginal benefit exceeds marginal cost.
• B) buyers cannot control the price, so the consumer surplus is zero.
• C) the consumer surplus is equal to zero because of competition.
• D) at the equilibrium price, marginal benefit equals marginal cost.
• E) at the equilibrium price, the total amount of consumer surplus equals the total amount of producer surplus.

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Definitions:

Moral Standards

Principles or rules of behavior based on ideas about what is ethically right and wrong, guiding actions and decisions in personal and professional contexts.

Lack

A deficiency or absence of something needed, desired, or customary, often leading to challenges or limitations.

Brand

A unique design, sign, symbol, words, or a combination of these, employed in creating an image that identifies a product and differentiates it from its competitors.

Marketing Mix

A combination of factors that can be controlled by a company to influence consumers to purchase its products, typically including product, price, place, and promotion.