Use the Figure Below to Answer the Following Questions

question 151

Multiple Choice

Use the figure below to answer the following questions.

Figure 2.2.1
-In Figure 2.2.1, when 4,000 bicycles are produced each month,

• A)the marginal benefit from another bicycle is greater than the marginal cost of another bicycle.
• B)more bicycles must be produced to reach the efficient level of output.
• C)fewer bicycles must be produced to reach the efficient level of output.
• D)the economy is efficient at this level of production of bicycles.
• E)both A and B.

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Definitions:

Incidental Beneficiary

A third party who benefits from a contract between two other parties, albeit without the intent of the contracting parties to specifically benefit that individual.

Intended Beneficiary

A person or entity outside of a contract whom the parties intend to benefit directly through the contract’s performance.

Court

A legal institution where disputes are settled, judgments are made, and justice is administered under the law.

Contract

A legally binding agreement between two or more parties that outlines obligations and rights, enforceable by law.