If Project A has a cost of 2, and provides a benefit of 3, and Project B has a cost of 5 and provides a benefit of 8, which of the following statements is true?
A) The net benefit of Project A is 5.
B) An individual can optimize by choosing Project B.
C) Project A has a higher net benefit than Project B.
D) A shift from Project A to Project B increases the net benefit by 1.
Question 2
If restrictions on entry and exit of firms are introduced in free markets, ________.
A) all existing firms earn equal profits in the long run
B) existing firms incur equal losses in the long run
C) the market allocates resources efficiently
D) resources in the market are not allocated efficiently
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