Consumer\'s surplus value equals the value the consumer places on her purchases

Question

Consumer's surplus value equals the value the consumer places on her purchases minus the amount she actually paid. As output increases, diminishing returns eventually raises marginal cost. A price laker firm has a vertical demand curve. Average fixed costs continue to fall as a firm increases the rate of production. I he smaller the elasticity of demand for a firm's output, the greater the degree of competition faced by the firm. If price is above average cost, the firm is earning economic profits. Profits are maximized where TR = TC The tact that owners receive profits tends to reduce shirking.

Explanation / Answer

12) False 13) true 14) True 15) False 16)True 17)False 18) False 19)True

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