Examlex
Suppose that an MBA degree creates no externality because the benefits of an MBA are internalized by the student in the form of higher wages. If the government offers subsidies for MBAs, then which of the following statements is correct?
Average Total Cost
The total cost of production (fixed and variable costs) divided by the quantity of output produced.
Marginal Revenue
The augmented income obtained by selling one more unit of a good or service.
Marginal Cost
The increase in total cost that arises from producing one additional unit of output.
Competitive Market
A market structure characterized by a large number of buyers and sellers, such that no single participant can significantly influence price.
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