Suppose the Demand Curve for Steel Is Q = 100

question 65

Multiple Choice

Suppose the demand curve for steel is Q = 100 - P, where P is the price per unit of steel and Q measures millions of units of steel. The private marginal cost of producing steel is MC = 5Q + 40, while the external marginal cost of producing steel is $12. In a perfectly competitive steel industry, the deadweight loss is:

• A) $12 million.
• B) $2 million.
• C) $750,000.
• D) $200,000.

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A group of individuals sharing a common factor (e.g., age, experience) within a specified period, often studied to identify patterns over time.

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Cross-sectional

A research design that analyzes data from a population, or a representative subset, at one specific point in time.