Midterm 2 sample

Midterm 2 sample - MULTIPLE CHOICE. Choose the one...

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MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) The principles governing the behavior of marginal benefit and marginal cost are A) increasing marginal benefit and increasing marginal cost as output increases. B) decreasing marginal benefit and decreasing marginal cost as output increases. C) increasing marginal benefit and decreasing marginal cost as output increases. D) decreasing marginal benefit and increasing marginal cost as output increases. 2) When the level of output is such that marginal benefit exceeds marginal cost, then to reach the efficient quantity, A) production should be increased. B) more information is needed to determine if production should be increased, decreased, or not changed. C) production should be decreased. D) production should remain constant. 3) If the marginal benefit of producing the last unit of pizza is greater than the marginal cost of producing the last unit of pizza, then A) more pizzas must be produced to reach the efficient level. B) the number of pizzas produced is efficient. C) revenue for pizza producers is maximized. D) fewer pizzas must be produced to reach the efficient level.
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This note was uploaded on 05/02/2008 for the course ECON 1 taught by Professor Tang during the Fall '08 term at UCSD.

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Midterm 2 sample - MULTIPLE CHOICE. Choose the one...

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