The Supply and Demand Conditions Facing a Firm That Makes

question 66

Multiple Choice

The supply and demand conditions facing a firm that makes widgets and generates a negative externality by dumping a highly toxic sludge in a nearby river is given in the table below.

The equilibrium price and quantity when only private costs are taken into account are

• A) Price = $55, Quantity = 30
• B) Price = $40, Quantity = 55
• C) Price = $30, Quantity = 20
• D) Price = $30, Quantity = 80

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Definitions:

Smaller Contract

A legally binding agreement between parties that is less extensive or lower in value or duration compared to other contracts.

Cash Prize

A monetary award given to an individual or group as recognition for achievement or as an incentive in competitions.

Throwing A Dart

An action involving skill and precision where a small, pointed missile is launched by hand toward a target, often used in games or competitions.

Probability Distribution

A mathematical function that provides the probabilities of occurrence of different possible outcomes for an experiment.