Table 16-4 Imagine a Small Town in Which Only Two Residents, Tony

question 110

Multiple Choice

Table 16-4
Imagine a small town in which only two residents, Tony and Jill, own wells that produce safe drinking water. Each week Tony and Jill work together to decide how many gallons of water to pump, to bring the water to town, and to sell it at whatever price the market will bear. To keep things simple, suppose that Tony and Jill can pump as much water as they want without cost so that the marginal cost of water equals zero.
The weekly town demand schedule and total revenue schedule for water is shown in the table below.

-Refer to Table 16-4.As long as Tony and Jill operate as a profit-maximizing monopoly,what will their weekly revenue equal?

• A)$200
• B)$270
• C)$350
• D)$360

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Definitions:

Centimeter

A unit of length in the metric system, equivalent to one hundredth of a meter, used commonly to measure small distances.

Inches

A unit of length in the Imperial and United States customary systems, equivalent to 1/12 of a foot.

Microgram

A unit of mass equal to one millionth of a gram.

Milligram

A mass measurement in the metric system equivalent to 0.001 grams.