Use the Following to Answer Questions

question 266

Multiple Choice

Use the following to answer questions
Figure: Determining Surplus 4
-(Figure: Determining Surplus 4) In the graph,how much is consumer surplus?

• A) $40
• B) $80
• C) $130
• D) $160

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Definitions:

Diminishing Returns

A principle stating that as one input in the production process is incrementally increased, there will be a point at which the added output from each additional unit of input will start to decrease.

Diseconomies of Scale

This phenomenon occurs when a firm's production costs per unit increase as it produces more, due to inefficiencies that arise from scaling up operations.

Economic Profit

The economic result derived from subtracting a business's entire expenses, both explicit and implicit, from its total incoming funds.

Product Price

The amount of money required to purchase a good or service, determined by factors like production cost, market demand, and competition.