Table 16-7 Suppose the Countries of Xania and Pluntia Share the World

question 168

Multiple Choice

Table 16-7
Suppose the countries of Xania and Pluntia share the world supply of water. Suppose that the marginal cost of bottling water is a constant $4 per gallon, and the demand for water is described by the following schedule:

-Refer to Table 16-7.If there were many suppliers of bottled water,what would be the price and quantity?

• A)$6, 400
• B)$5, 500
• C)$4, 600
• D)$3, 700

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Definitions:

Agricultural Risk Coverage

Agricultural Risk Coverage is a U.S. government program designed to protect agricultural producers from revenue losses due to market fluctuations.

Payments

The act of transferring money or its equivalent in exchange for goods, services, or to fulfill a legal obligation.

Fixed Costs

Costs that do not vary with the level of output or sales, such as rent, salaries, and insurance.

Variable Costs

Expenses that vary directly with the level of production or output, including costs such as raw materials and labor directly involved in manufacturing.