A Small Nation Has Three Gasoline Suppliers with a Linear

question 55

Multiple Choice

A small nation has three gasoline suppliers with a linear monthly market demand equal to: Q = 500,000 - 5P. Each firm's marginal cost (MC) and average total cost (ATC) curves are horizontal at $10,000 per month.
-Refer to the information above. If the firms' managers form a price- fixing cartel that maximizes the firms' total profit, what is the total economic profit made by all firms?

• A)$575,000,000
• B)$10,125,000,000
• C)3,375,000,000
• D)$54,000,000

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.