If PX > MCX, society gains by ?
Correct answer: C. Producing more X
- A. raising the price of X.
- B. production less X
- C. Producing more X
- D. Increasing the cost of producing X
Explanation
Price represents the marginal benefit of the good, so PX greater than MCX means the extra benefit from another unit exceeds its extra production cost. Society therefore gains from producing more X.
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Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
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