Exhibit 7-1 -Refer to Exhibit 7-1. If Firm a Is Producing 5

question 119

Multiple Choice

Exhibit 7-1
-Refer to Exhibit 7-1. If Firm A is producing 5 units and Firm B is producing 3 units, then

• A)both firms should produce more because there is no way only 8 units could fulfill demand in a market.
• B)Firm A should produce more and Firm B should produce less.
• C)if Firm B reduced production by 1 unit, the savings would allow Firm A to produce 6 more units.
• D)if Firm A reduced production by 1 unit, the savings would allow Firm B to produce 2 more units.
• E)Pareto efficiency is achieved.

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Definitions:

Lactiferous Ducts

A network of milk-carrying ducts within the breasts that transport milk from the mammary glands to the nipple.

Areolar Glands

Modified sweat glands found in the areolar tissue around the nipple that lubricate and protect the breast during breastfeeding.

Rugae

Folds or ridges found in the internal stomach lining and other bodily organs that allow for expansion.

Perimetrium

Outer serous coat of the uterus; also called serous layer.