Other things equal, if the price of a key resource used to produce product X falls, the:
O product supply curve of X will shift to the right
O product demand curve of X will shift to the right
O product supply curve of X will shift to the left
O product demand curve of X will shift to the right
The MR-MC rule can be restated for a purely competitive seller as
P-MR-MC
MR-MC but P is not equal to MC
MR-MC but P is not equal to MR
MR is not equal to MC but P-MR
Law of diminishing marginal utility states that
O total utility is maximized when consumers obtain the same amount of utility per units of each product consumed
O beyond some point additional units of a product will yield less and less extra satisfaction to a consumer
O price must be lowered to induce firms to supply more of a product
O it will take larger and larger amounts of resources beyond some point to produce successive units of product
