Figure 10-1 ​

question 103

Multiple Choice

Figure 10-1
​
-If the price level in Figure 10-1 were 120,

• A)there would be excess goods on the market.
• B)firms would have to raise their prices.
• C)inventories would be disappearing.
• D)aggregate quantity demanded would exceed aggregate quantity supplied.

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Definitions:

Marginal Revenue

The additional income generated from the sale of one more unit of a product or service.

Marginal Cost

A rephrased definition: The expense incurred in the manufacture or production of an additional quantity of a product or service.

Price Discrimination

A pricing strategy where a company charges different prices to different groups of customers for the same product or service, based on factors other than production costs.

Producer Surplus

The difference between the amount producers are willing to accept for a good or service and the actual amount they receive in the market.