Suppose the Actions of the Producers of a Good Generate

question 32

Multiple Choice

Suppose the actions of the producers of a good generate an external benefit which results in the actual market price of $15 and market output of 614 units. How does this outcome compare to the efficient, ideal equilibrium?

• A) The efficient price would higher than $15 while the efficient output would be less than 614 units.
• B) The efficient price would be higher than $15 while the efficient output would be greater than 614 units.
• C) The efficient price would be lower than $15 while the efficient output would be less than 614 units.
• D) The efficient price would be lower than $15 while the efficient output would be greater than 614 units.

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Definitions:

Product Replication

The act of duplicating or making a copy of an existing product, typically to broaden market reach or capitalize on the success of the original item.

Manufacturing Flexibility

The ability of a manufacturing system to quickly adapt to changes in product type or volume without incurring high costs or delays.

Competitive Advantage

The unique feature or set of features of a company and its products that are perceived as superior in the market, contributing to greater sales or margins than competitors.

Assembly Lines

A manufacturing process in which parts are added to a product in a sequential manner, using conveyors or other efficient means, to create a finished product efficiently.