-In the Above Figure, CBL Is the Cost of Breaking

question 83

Multiple Choice

-In the above figure, CBL is the cost of breaking the law. If the good in the figure is made illegal and penalties are imposed on both buyers and sellers, then its price per unit

• A) will be lower than if it was not illegal.
• B) cannot be compared with its price when it was legal.
• C) will be the same as when it was not illegal.
• D) will be higher than if it was not illegal.

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Definitions:

Marginal Revenue

The additional income gained from selling one more unit of a product or service.

Marginal Costs

The increase in total production cost that comes from making or producing one additional unit.

Average Total Costs

The cost per unit of output, calculated by dividing the total cost by the quantity of output produced.

Technological Change

The process of innovation and development of new methods, products, or processes, driving efficiency and economic growth.