Suppose That the Equations S = 2P and D =

question 19

Multiple Choice

Suppose that the equations S = 2P and D = 6 - P represent a small
Country's home supply and home demand curves.Which of the following
Is the equilibrium price in autarky?

• A)$2
• B)$4
• C)$6
• D)$8

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Definitions:

Product-variety Externality

The impact on consumer welfare or market efficiency due to variety in products available, often seen as a positive externality in markets.

Business-stealing Externality

A negative effect where a new entrant in a market draws customers from existing businesses, potentially harming those businesses without creating new value for the market as a whole.

Negative Externality

A cost that affects a party who did not choose to incur that cost, often associated with the production or consumption of a good or service.

Advertising

The activity or profession of promoting products, services, or ideas through various forms of media.