The Condition P = MC Implies That

question 81

Multiple Choice

The condition P = MC implies that

• A) there is no consumer surplus for any consumer.
• B) an individual who values the product at more than P will receive consumer surplus.
• C) an individual who values the product at less than P will receive consumer surplus.
• D) the amount of consumer surplus is infinite.

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Definitions:

Utility Function

An economic concept expressing how different combinations of goods or services yield different levels of utility or satisfaction to an individual.

Endowment

The initial allocation of income, goods, or resources that individuals or firms possess in an economy, often impacting their trading capabilities and outcomes in markets.

Price

The amount of money required to purchase a good or service, reflecting its value in a market economy.

Endowment

The total resources available to an individual or entity, including income, assets, and wealth.