10. Marginal utility is zero: it means

a. The change in income that will allow a consumer to feel slightly better off.

b. The total satisfaction received from consuming additional unit of a good remain unchanged.

c. The total satisfaction received from consuming additional unit of a good is decreasing

d. The change in total utility from consuming one additional unit of a good is increasing

11. Suppose the price elasticity of good X is 2. If the market price of good X increases by 10%, then by how much percent the quantity demanded for good X decreases?

a. 10%

b. 20%.

c. 30%.

d. 40%.

12. Which of the following is explicit cost?

a. payment for the utility bill.

b. forgone wage for self-employed's labor.

c. forgone rent for self-employed's land.

d. forgone interest for self-employed's capital.

13. The period of time over which the plant capacity can be altered is called the:

a. Planning period.

b. Short run.

c. Long run.

d. None of above.

14. Change in total cost associated with a oneunit change in production is called:

a. Variable cost.

b. Marginal cost.

c. Average cost.

d. Total cost.

15. If your business goes better, you are not supposed to worry about the monthly rental payment. This phenomenon is well explained by the fact that:

a. Average variable cost would approach zero.

b. Marginal cost would approach zero.

c. Average fixed cost would approach zero.

d. Total fixed cost would approach zero.