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Why do the average total cost and average variable cost curves get closer to one another as output increases?
Marginal Cost discuss why the marginal cost of production must increase if the marginal product of the variable resource is decreasing.
Marginal Cost What is the difference between fi xed cost and variable cost? If no, explain why each does or does not affect marginal cost.
Also, you must decide how far apart to space the plants. Will diminishing returns be a factor in your decision making? If so, how will it affect your decisions?
What could change the equilibrium price? What market pressure occurs when quantity supplied exceeds quantity demanded? Explain.
What are the effects on the equilibrium price and quantity of steel if the wages of steelworkers rise and, simultaneously, the price of aluminum rises?
What happens to the quality of housing and why? How do landlords of rent-controlled apartments try to get tenants to leave?
Read the article Law of Supply, Demand Applies to Everyone. Did the article describe a surplus of supply or a shortage of supply?
Why is the price elasticity of demand for cigarettes among teenagers greater than it is among those 20 and over?
By what percentage would a 10 percent rise in the price reduce the quantity demanded, assuming price elasticity remains constant along the demand curve?
Cross-Price Elasticity Using demand and supply curves, predict the impact on the price and quantity demanded of Good. What if the two goods are complements?
If the price of a cookie is less than the price of candy, is the consumer in equilibrium? What should the consumer do to attain equilibrium?
Law of Diminishing Marginal Utility Some restaurants offer all you can eat meals. How is this practice related to diminishing marginal utility?
But so many jobs were lost in the boat-building industry that the measure was finally repealed. What did Congress get wrong in imposing this luxury tax?
Under what conditions of demand and supply elasticities does this occur? Under what conditions is little of the tax passed on to consumers?
What areas in the figure would you use to illustrate the net change in farmers' total revenue as a result of the increase in supply?
By how much would farm income change compared to what it would have been without government intervention?
The Marginal Value of Free Medical Care Go to Global Economic Crisis Resource Center. Describe consumer surplus of average citizen in each category of country
Think about the first paragraph of the book review. Do you expect to experience diminishing marginal utility in your economics course?
What can you say about the marginal valuation that consumers place on the 300th shirt, the 700th shirt, and the 1,200th shirt they might buy each year?
Assuming that the consumer is in equilibrium and is consuming both X and Y, what must the marginal utility of Y be?
Discuss what must be true about the equilibrium relationship between the marginal utility levels of the last unit consumed of each good?
What is the diamondswater paradox, and how is it explained? Use the same reasoning to explain why bottled water costs so much more than tap water.
Why does this mean that consumers get greater marginal utility from each unit of this good than they did before? Explain.
Draw a supply and demand graph to illustrate the consumer surplus that occurs when the market is in equilibrium.