Michael consumes only steak and lobster. Suppose that the price ...

[ts19998]

Michael consumes only steak and lobster. Suppose that the price of steak rises. After Michael is back at equilibrium, compared to the situation when steak was cheaper, the marginal utility from the last steak will
 
  A) have increased.
  B) not have changed.
  C) have decreased.
  D) not be comparable with the marginal utility before the price hike.

Question 2

In the long run, a perfectly competitive firm will exit a market when
 
  A) its total revenue is less than its total cost.
  B) its marginal revenue curve is below the minimum of its average total cost curve.
  C) the price is greater than the minimum of its average total cost curve.
  D) Both answers A and B are correct.

[batool]

Answer to Question 1

A

Answer to Question 2

D

[ts19998]

Thank you

[batool]

Happy to help you