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tsukikageMarginal social costs are equal to
A. Marginal private costs plus marginal private benefit
B. external costs
C. marginal social cost plus external costs
D. marginal social costs minus external costs
Something seems wrong with this question... In the notes, MSC is equal to (marginal) private cost plus (marginal) external cost. I'm going to guess the "correct answer" is C, and they just mis-typed that.
[EDIT: This one seems off too:
In an attempt to raise sales, Hannah cut prices in her bookstore by 20 percent. If the dollar value of her sales remained constant, that indicates
A. the demand curve is vertical.
B. old customers bought no more books.
C. no new customers bought books.
D. the quantity of books sold increased 20 percent.
I believe the answer should be "the quantity of books sold increased by 25 percent".]
A. Marginal private costs plus marginal private benefit
B. external costs
C. marginal social cost plus external costs
D. marginal social costs minus external costs
Something seems wrong with this question... In the notes, MSC is equal to (marginal) private cost plus (marginal) external cost. I'm going to guess the "correct answer" is C, and they just mis-typed that.
[EDIT: This one seems off too:
In an attempt to raise sales, Hannah cut prices in her bookstore by 20 percent. If the dollar value of her sales remained constant, that indicates
A. the demand curve is vertical.
B. old customers bought no more books.
C. no new customers bought books.
D. the quantity of books sold increased 20 percent.
I believe the answer should be "the quantity of books sold increased by 25 percent".]
