13) Which of the following is correct? 13) L. Marginal benefit is the benefit th
ID: 1128468 • Letter: 1
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13) Which of the following is correct? 13) L. Marginal benefit is the benefit that a person receives from consuming one more unit of a good. IL. The marginal benefit of a pizza is the amount of another good that people are willing to give up get a pizza. A) only II B)neither I nor ll C)both 1 and 11 D) only I 14) The principle of decreasing marginal benefit implies that the 14) A) total benefit from obtaining more of a good or service decreases as more is consumed. B) total benefit from obtaining more of a good or service remains the same as more is consumed. C) additional benefit from obtaining one more of a good or service increases as more is D additional benefit from obtaining one more of a good or service decreases as more is 15) The short run effect of a decrease in the supply of housing is a in the rent andin 15) the quantity of housing units. A) rise, an increase B) rise; a decrease C) fall; a decrease D) fall; an increase 16) 16) In the absence of a rent celiling, the long run adjustment to an initial decrease in the supply of housing is A) an increase in the supply of housing due to profits. B) an increase in the supply of housing due to the initial surplus C) a decrease in demand for housing due to higher rent. D) a decrease in demand for housing due to the initial shortage 17) 17) A minimum wage set above the equilibrium wage will A) create a lower wage rate for skilled workers than for unskilled workers. 8) have no effect because the equilibrium level of employment is not affected by a minimum wage above the equilibrium wage C) create a shortage of labor. D) create a surplus of labor 18) 18) A household's consumption cholces cannot exceed limits created by A) only the household's income B) only the prices of the goods and services that it buys. both the household's income and the prices of the goods and services that it buys D) neither the household's income nor the prices of the goods and services that it buys. Vhich of the following is true regarding perfect competition? I The firms are price takers. IL. Marginal revenue equals the price of the product 01, 11 and ul. Established firms have no advantage over new firms. B) II and II C) I only D) 1 and II 20) Perfect competition implies that A) all firms are price takers. B) all firms are producing the same identical product there are many firms in the industry All of the above answers are correctExplanation / Answer
13) The correct answer to this question is "C". Both the statements given are correct. The marginal benefit can be defined as the benefit which the consumer gets from consuming one more unit of that good and it can also be defined as the maximum amount the person is willing to pay for consuming that extra good. Here the amount he is giving up on other good is the cost he is paying for getting one extra of the good he is consuming.
14) "D," Law of diminishing marginal utility tells that the benefit of consuming one good decrease by consuming more and more of that good.
15) "B", a decrease in the supply of houses for rent will cause the rent to rise and a decrease in the supply of housing unit.
16) "A" it will cause an increase in the supply of housing in the long run.
17) "B" a minimum wage set above the equilibrium price will have no effect on the supply or dead of labor.
18) "C" both the household income and price of the good limit the buying potential of the house.
19) "A" all the statements about the firm in the perfect industry is correct.
20) "D" all the statements are correct.
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