Consumer surplus is the diffence between what an individual is willing to pay for a good and its market price. Consumer surplus occurs when the consumer's willingness to pay is higher than the good's market price, as in the example where the hungry man pays $3 for a slice of pizza, but would have gladly paid $5 for it.

The only factor that would shift the pizzeria's cost upward is an increase in the price of cheese, one of the pizzeria's inputs. A decrease in wages would shift the cost curve upward. Changes to the pizzeria's output or prices would not shift the pizzeria's cost curve in any direction.

If an increase in the price of pizza causes a decrease in the demand for soda, then the two goods are complementary goods, or goods that are typically consumed together. Thus, the two goods' demand are affected by the demand of the other good. As the price of pizza increases, its demand will likely decrease. The decrease in demand for pizza causes a decrease in demand for soda because the two goods are complementary.

Price elasticity of demand is the measure of the responsiveness of the quantity demanded of a good to the change in its price. Elasticity is calculated by the percentage change in quantity demanded divided by the percentage change in price. In this case, the price elasticity demand of movie tickets is 0.5 (10% change in quantity demanded divided by 20% change in price). If a good's elasticity is less than 1, it is considered inelastic.

A pure public good is non-rival, which means that use by one individual does not reduce its availability to others, and non-excludable, which means that an individual cannot be prevented from consuming the good. Because of its non-rivalrous nature, a public good's consumption has zero marginal cost. A lighthouse is a classic example of a public good. An additional person's use of the lighthouse does not have any associated marginal cost, since its use is non-rivalrous.

A private good is rivalrous, which means that one person's use of the good reduces the availability of the good for others, and excludable, which means that individuals can be effectively excluded from consuming the good. The only choice that fits both descriptions is the bicycle.

An oligopolistic industry is dominated by a small number of firms. Oligopolies are typically caused by significant barriers to entry, which enable a few firms to dominate the industry.

As its supply decreases and its demand increases, the price of pizza will definitely increase. However, the change in quantity is ambiguous and depends on which effect is stronger.

A public good is non-rival, which means that one person's consumption of a good does not affect another person's consumption of the good, and non-excludable, which means that a person cannot be prevented from consuming the good. The only answer that is non-rival and non-exculdable is the neighborhood park.

When a a perfectly competitive market is in equilibrium, the marginal revenue curve is a horizontal line at the price level in contrast to monopolies, where the marginal revenue is below price.

All of the other answer choices are key characteristics of perfectly competitive markets.