14 The additional benefit of producing one more roast beef sandwich at a local d

Question

14 The additional benefit of producing one more roast beef sandwich at a local deli is S3. The additional cost of producing one more roast beef sandwich is $3. To improve allocative efficiency: O producers should produce one more roast beef sandwich because MB> MC. O producers should produce one more roast beef sandwich because MB equals MC. O producers should not produce one more roast beef sandwich because MB > MC. O producers should not produce one more roast beef sandwich because MB equals MC. 0.13 polnts Skipped Print

Explanation / Answer

14. Additional benefit of producing one more unit is $ 3

Cost of producing one more additional unit is $ 3

That is marginal benefit = marginal cost

Therefore, the firm will be indifferent in producing one additional unit of sandwich.

Hence the firm should produce one more additional unit of roast beef sandwich because MB = MC.

Option B.

16. The quantity demanded is equal to quantity supplied at a price of $ 150. Therefore, the equilibrium quantity is 70 units and equilibrium price is $ 150 per unit.

Efficient because the marginal cost of producing the lawnmower equals the marginal benefit to consumers.

Option B.

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