Table 17-3 Imagine a Small Town in a Remote Area Where Only

question 115

Multiple Choice

Table 17-3
Imagine a small town in a remote area where only two residents, Maria and Miguel, own dairies that produce milk that is safe to drink. Each week Maria and Miguel work together to decide how many gallons of milk to produce. They bring milk to town and sell it at whatever price the market will bear. To keep things simple, suppose that Maria and Miguel can produce as much milk as they want without cost so that the marginal cost is zero. The weekly town demand schedule and total revenue schedule for milk is shown in the table below:
-Refer to Table 17-3. If this market for milk were perfectly competitive instead of monopolistic, what would be the price for milk?

• A)$0
• B)$10
• C)$12
• D)$16

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Definitions:

Home Runs

In baseball, a hit by a batter that allows them to circle all the bases, reaching home safely in one play, usually by hitting the ball over the outfield fence.

American League

One of two leagues making up Major League Baseball (MLB) in the United States and Canada, featuring teams such as the New York Yankees and Boston Red Sox.

Histogram

A graphical representation of data using bars of different heights, where each bar groups numbers into ranges to show the distribution of a dataset.

Mean

The average of a set of numbers, calculated by adding all the numbers together and dividing by the number of numbers.