Question: The chapter states, Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of

The chapter states, "Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of producing them." A student objects to this statement, arguing, "I doubt that firms will really do this. After all, firms are in business to make a profit; they don't care about what is best for consumers." Evaluate the student's argument.

Step by Step Solution

★★★★★

3.30 Rating (179 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

The student is correct to note that a firms goal is to maximize its profit and not ... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

1347-B-A-A-M-E(580).docx

120 KBs Word File

Students Have Also Explored These Related Micro Economics Questions!

Q:

In exercise 27.3, we considered some ways in which we can differentiate between goods that lie in between the extremes of pure private and pure public goods. A: Consider the case where there is a...

Q:

A. One of the most important skills to learn in managerial economics is the ability to identify a good business. Discuss at least four characteristics of a good business. B. Identify and talk about...

Q:

Megaboite Distributors Limited is reviewing its year-end inventory calculations. It uses the FIFO cost formula in a perpetual inventory system. The company had $4.7 million of inventory at the...

Q:

The chapter states, Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of producing them. A student objects to this statement,...

Q:

The chapter states, Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of producing them. A student objects to this statement,...

Q:

The chapter states, Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of producing them. A student objects to this statement and...

Q:

The chapter states, Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of producing them. A student objects to this statement,...

Q:

The chapter states, Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of producing them. A student objects to this statement,...

Q:

The chapter states, Firms will supply all those goods that provide consumers with a marginal benefit at least as great as the marginal cost of producing them. A student objects to this statement and...

Q:

the forces controlling its profitability (e.g., Five Forces analysis). Is Best Buy positioned for long-term profitability? Best Buy Co., Inc. By 2017, the value of Best Buy's stock climbed over 200...

Q:

Acme Corporation enters into a 5 year term loan with JP Morgan bank on January 1, 2020. JP Morgan is the lead with 40% and has syndicated the remaining 60% with PNC, Wells Fargo and Deutsche at 20%...

Q:

Octane, C8H18, is burned with theoretical amount of air at 500 kPa. Determine (a) The air fuel ratio on a mole basis. (b) The air fuel ratio on a mass basis. (c) IF the products are cooled at a...

Q:

Question 4 9 0 . 6 pts When preparing a classified balance sheet, which classification would "Accounts Payable" fall under? Current Liabilities Current Assets Long - term Assets Long - term...

Q:

1.Distinguish between different models of supplier- induced demand (SID)

Q:

What is the public choice model?

Q:

In Chapter 4, Section 4.3, we discussed the federal governments agricultural program, which is often called the farm bill. Because the U.S. Department of Agriculture administers the Supplemental...

Q:

In Chapter 4, Section 4.3, we discussed the federal governments agricultural program, which is often called the farm bill. Because the U.S. Department of Agriculture administers the Supplemental...

Q:

E9-9 (Algo) Colculating Direct Labor Variances [LO 9-4] Parke Plastic, Incoxporated, mahufactures plastic mats to use whth rolling office chairs its standard cost information for last year follows....

Q:

Michael has a 25 year mortgage for $350000 with monthly payments of $3118.98. a) What is the nominal annual rate compounded monthly? After 3 years the interest rate has gone down to 6.75% (compounded...

Q:

Tyler Trucks stock has an annual return mean and standard deviation of 13 percent and 42 percent, respectively. Michael Moped Manufacturing stock has an annual return mean and standard deviation of...