QUESTION 35

Movement along Big Oaks Production Possibilities Frontier	Gain in Lumber (per unit)	Forgone Paper Products (per unit)
A to B	1	0.50
B to C	1	1.25
C to D	1	2.50
D to E	1	4.50
E to F	1	7.0

Big Oaks can produce either paper products or lumber with each tree that they harvest. Because Big Oaks can adjust the amount of paper products and lumber they produce from the harvested trees, paper products and lumber are produced in variable proportions. The above table summarizes Big Oaks production possibilities from each harvested tree. Refer to the table above. If the profit for each unit of paper product is $2 and the profit for each unit of lumber is $5, what is the marginal benefit for each unit of paper products produced?

		$5
		$2
		$3
		$7

QUESTION 30

An exclusive dealing contract is a ________ contractual requirement that ________.

		horizontal; forbids the buyer from selling products that compete with the seller's product
		vertical; forbids the buyer from selling products that compete with the seller's product
		horizontal; requires the buyer to purchase 100 percent of the product that it needs from the supplier
		vertical; requires the buyer to purchase 100 percent of the product that it needs from the supplier