Table 17-10 the Table Shows the Town of Driveaway's Demand Schedule for Schedule

question 296

Multiple Choice

Table 17-10
The table shows the town of Driveaway's demand schedule for gasoline. Assume the town's gasoline seller(s) incurs a cost of $2 for each gallon sold, with no fixed cost.

-Refer to Table 17-10.If there are exactly two sellers of gasoline in Driveaway and if they collude,then which of the following outcomes is most likely?

• A) Each seller will sell 50 gallons and charge a price of $7.
• B) Each seller will sell 75 gallons and charge a price of $2.50.
• C) Each seller will sell 75 gallons and charge a price of $5.
• D) Each seller will sell 100 gallons and charge a price of $4.

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Definitions:

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost than another entity.

Geegaws

Ornamental objects of no substantial value, often considered trinkets or gadgets.

Doodads

Informal term for small objects or gadgets, often of little value and used for decoration or trivial purposes.

Competitive Market

A market structure characterized by a large number of buyers and sellers, free entry and exit, and products that are close substitutes, leading to price determination by supply and demand.