(Table: Gascolator Producers I) Banner and Sense Are Bertrand Competitors

question 38

Multiple Choice

(Table: Gascolator Producers I) Banner and Sense are Bertrand competitors producing identical gascolators (a main line strainer) . The inverse market demand curve for gascolators is P = 2,000 - 4Q, where Q is the quantity of gascolators and P is the price per gascolator. Banner and Sense produce gascolators at a constant marginal cost of $80. If Banner charges a price of $100 and Sense charges $101, Banner's quantity sold is ____.

• A) 480
• B) 475
• C) 237.50
• D) 0

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Definitions:

Service

A type of economic activity that is intangible, is not stored, and does not result in ownership; services are produced and consumed at the same time.

Exchange

The act of giving one thing and receiving another in return, often referring to the trade of goods, services, or financial instruments.

Functions Of Money

The core roles money plays in an economy, including serving as a medium of exchange, a unit of account, a store of value, and sometimes, a standard of deferred payment.

Medium Of Exchange

An intermediary instrument or system used to facilitate the sale, purchase, or trade of goods between parties.