Use the Following to Answer Question(s): Supply and Marginal Factor

question 63

Multiple Choice

Use the following to answer question(s) : Supply and Marginal Factor Cost

-(Exhibit: Supply and Marginal Factor Cost) How many factors will be supplied at a factor price of $10?

• A) 3
• B) 4
• C) 5
• D) It cannot be determined.

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Definitions:

Elastic Demand

When consumer demand for a product significantly rises or falls following a small change in its price.

Price Discrimination

The practice of selling the same product to different buyers at different prices, based on factors other than cost.

Consumer Surplus

The difference between the total amount consumers are willing to pay for a good or service and the actual amount they pay.

Producer Surplus

The difference between the amount producers are willing to sell a good for and the actual amount they receive by selling it at the market price.