A Quantity Less Than the Equilibrium Quantity in a Competitive

question 102

Multiple Choice

A quantity less than the equilibrium quantity in a competitive market is inefficient because

• A) the marginal benefit of another unit is greater than its marginal cost.
• B) too much of the good is being produced.
• C) the marginal cost of another unit is greater than its marginal benefit.
• D) the marginal benefit of another unit is not equal to zero.
• E) the marginal benefit is not maximized.

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Definitions:

Conditioning Experience

The process through which an association between two stimuli or a behavior and a stimulus is learned.

A State

In psychology, a temporary emotional or mental condition in contrast to more stable traits.

Intensity

The level of force, strength, or magnitude of a particular stimulus or action.

Opponent Process Theory

Proposes that emotions are regulated by mechanisms that operate in opposition to each other, restoring emotional balance after disturbances.