A Firm That Uses the Latest Technology ________ Technologically Efficient

question 30

Multiple Choice

A firm that uses the latest technology ________ technologically efficient because ________.

• A)is not necessarily; the firm might not use the least amount of inputs to produce a given output
• B)is not necessarily; new technology is more expensive than old technology
• C)is; efficiency is about costs rather than when the technology was developed
• D)is; new technology isn't developed unless it is efficient
• E)is; most consumers want access to the latest technology

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Definitions:

Demand Function

An equation that illustrates the quantity of an item that will be demanded at various prices, assuming all other factors remain constant.

Equilibrium Price

The market price at which the quantity of a good supplied is equal to the quantity demanded, resulting in market equilibrium.

Marginal Cost

The augmentation in total cost triggered by the creation of one further unit of a product or service.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, leading to a state of market equilibrium.