It Costs Suppliers $1 to Produce Each Additional Widget, and Widgets

question 133

Multiple Choice

It costs suppliers $1 to produce each additional widget, and widgets sell for $2. Some consumers are not willing to pay $2 for a widget but are nevertheless willing to pay more than $1. Which of the following statements is TRUE?

• A) The market is at equilibrium.
• B) Suppliers must be reaping big profits.
• C) There are unexploited gains from trade.
• D) Consumers will bid up prices.

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Definitions:

Game Console

A specialized electronic device designed to play video games where users interact through controllers and graphical outputs.

Hardware Systems

The physical components and machinery of a computer or electronic system, including processors, memory devices, and circuits.

Digital Images

Visual images that have been encoded in a digital format, allowing them to be stored, viewed, and edited on electronic devices.

Interactive Device

A gadget or device designed to respond to input from a user, allowing for a two-way flow of information and interaction.