Author Question: Assume that excessive lobbying by tea cultivators led to the announcement of a price floor higher ... (Read 51 times)

karlynnae · **on:** Jun 30, 2018

Assume that excessive lobbying by tea cultivators led to the announcement of a price floor higher than the equilibrium price of tea. This legislation is likely to result in a shortage of tea leaves in the market.
Indicate whether the statement is true or false

Question 2

Assume that a firm is producing an output level such that marginal revenue equals marginal cost. One can correctly conclude that the firm is producing a level of output which is:
a. equal to the profit maximizing level of output.
b. equal to revenue maximizing level of output.
c. less than the profit maximizing level of output.
d. zero.
e. greater than the profit maximizing level of output.