The Maximum Price a Consumer Is Willing to Pay for a Second

question 183

Multiple Choice

The maximum price a consumer is willing to pay for a second slice of pizza is ________

• A)equal to the consumer surplus
• B)the consumer's marginal cost of a second slice of pizza
• C)the consumer's marginal benefit of a second slice of pizza
• D)always more than the maximum price the consumer is willing to pay for the first slice of pizza

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Definitions:

Supply And Demand Graph

A visual representation used in economics to show the relationship between the supply of products and the demand for them.

Public Good

A product or service that is non-excludable and non-rivalrous, meaning it can be used by anyone without diminishing its availability to others.

Allocative Efficiency

The apportionment of resources among firms and industries to obtain the production of the products most wanted by society (consumers); the output of each product at which its marginal cost and marginal benefit are equal, and at which the sum of consumer surplus and producer surplus is maximized.

Marginal Costs

The additional cost incurred by producing one more unit of a good or service, crucial for making production and pricing decisions.