Use the Following to Answer Questions

question 4

Multiple Choice

Use the following to answer questions:
Figure: Marginal Costs 1
-(Figure: Marginal Costs 1) This figure shows the production costs of two firms that produce steel beams. If these two firms represent total production in the industry, how should they allocate the production of 300 beams to minimize costs?

• A) Firm 2 should produce all 300 beams.
• B) Firm 1 should produce all 300 beams.
• C) Firm 1 should produce 150 beams, and Firm 2 should produce 150 beams.
• D) Firm 1 should produce 100 beams, and Firm 2 should produce 200 beams.

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Definitions:

Income Share

The distribution of total income among different groups or individuals, often used to analyze economic inequality.

Quintile

A statistical value that represents 20% of a given population or dataset, dividing it into five equal parts.

Percentage

A rate, number, or amount in each hundred.

Income Distribution

A measure of how a nation’s total GDP is distributed amongst its population.