At a Price of $1

question 38

Multiple Choice

At a price of $1.50, the total quantity demanded of a product is 80,000 units and the competitive fringe produces 15,000 units. What is the dominant firm's residual demand at a price of $1.50?

• A)95,000
• B)65,000
• C)50,000
• D)80,000

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Definitions:

Present Value

The present value of a future amount of money or series of cash flows, using a given rate of return.

Market Rate

The prevailing price or cost of products, services, or labor in a competitive marketplace as determined by supply and demand.

Interest

The cost of borrowing money, typically expressed as a percentage rate over a period of time, or the return on investment for savings.

ITQs

Individual Transferable Quotas, a common tool in fisheries management allowing holders to catch a specific percentage of the total allowable catch.