An optimal monopoly will produce at the level where this quantity equals marginal revenue. For 10 points each:
[10e] Name this quantity, defined as the amount needed to produce one additional unit.
ANSWER: marginal cost [prompt on cost]
[10h] This concept can be thought of as the point where price equals marginal cost. This concept measures the broad degrees of usefulness of a product or sector.
ANSWER: allocative efficiency [prompt on efficiency]
[10m] This phenomenon is represented graphically by a negative slope to the marginal cost curve. This phenomenon occurs when the sum of the exponents in the Cobb-Douglas function is greater than 1.
ANSWER: increasing returns to scale
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