Bennie's Top Factory Produces 1,000 Tops Per Day for a Total

question 79

Multiple Choice

Bennie's Top Factory produces 1,000 tops per day for a total daily revenue of $2,000.Bennie's total costs would rise by $2 if it produced the 1,001^st top.Because marginal revenue and price are equal and constant,

• A) profit would rise by $2 if Bennie produced one additional top
• B) profit would fall by $2 if Bennie produced one additional top
• C) profit would not change if Bennie produced one additional top
• D) profit will fall by some unknown amount if Bennie produced one additional top
• E) the total cost curve must have shifted to the left

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Definitions:

Price Floor

A government or regulatory-imposed minimum price that can be charged for a good or service, below which it cannot legally be sold.

Milk

A nutrient-rich liquid food produced by the mammary glands of mammals, commonly consumed by humans.

Market Equilibrium

A condition or state in which the supply of a product matches its demand, leading to a stable price.

Surplus

An excess amount of a product or resource compared to the demand for it.