A Supply Curve Shows Quantities Supplied at Various Prices

question 120

Multiple Choice

A supply curve shows quantities supplied at various prices.It also shows the

• A) total profit the firm earns at a given level of output.
• B) marginal benefit of the good.
• C) total cost of production.
• D) marginal cost of production.
• E) producer surplus, which is equal to the slope of the supply curve.

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Definitions:

Productive Efficiency

Productive efficiency occurs when an economy or entity produces goods and services at the lowest possible cost, utilizing all available resources without waste.

MB = MC

The principle that optimal decision-making is achieved when the marginal benefit equals the marginal cost.

Unintended Consequences

Outcomes of a policy or action that were not foreseen or intended, often contrary to the original objectives.

Allocating Resources

The process of distributing available resources among various competing needs or projects in an efficient manner.