If marginal utility is negative PDF

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1. If marginal utility is negative, then Total utility will decrease with additional consumption. 2. A production decision involves choosing A rate of output and is a short-run decision. 3. Define a price ceiling and explain how it affects resource allocation in a market. Give a real-world example of a price ceiling. A price ceiling is an upper limit imposed on the price of a good. It holds the price below the equilibrium price, and the result is that the quantity demanded is greater than the quantity supplied. This causes a shortage. Rent control in New York City and other places is an example of a price ceiling. 4. A perfectly competitive firm is a price taker because The price of the product is determined by many buyers and sellers. 5. Sam's surf shop has total costs of $2,000 when it is not producing any surfboards. This means that Fixed costs are $2,000. 6. The most desired goods or services that are given up when a choice is made are called the Opportunity cost. 7. In Table 19.3, what is the marginal utility of the fifth unit of cola? 12. 8. Refer to Figure 19.1. The total consumer surplus in this market is equal to $900. 9. Profit per unit is equal to P - ATC. 10. Ceteris paribus, if income increases and as a result, the demand for good X increases and the demand for good Y falls, Good X is a normal good and good Y is an inferior good. 11. A demand curve that is perfectly inelastic is Vertical. 12....