Suppose the Accompanying Table Describes the Relationship Between Price and Quantity

question 133

Multiple Choice

Suppose the accompanying table describes the relationship between price and quantity demanded for a monopolist.  
$$\begin{array} { | c | c | } \hline \text { Quntity } & \text { Price } \\\hline 1 & \$ 10 \\\hline 2 & \$ 9 \\\hline 3 & \$ 8 \\\hline 4 & \$ 7 \\\hline 5 & \$ 6 \\\hline 6 & \$ 5 \\\hline 7 & \$ 4 \\\hline 8 & \$ 3 \\\hline\end{array}$$ If the marginal cost of producing each unit of output is $5, then the socially optimal level of output is ________.

• A)3 units
• B)6 units
• C)7 units
• D)4 units

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Definitions:

Aldose

A type of carbohydrate that contains an aldehyde group as its carbonyl functional group.

Glycosides

Compounds formed from a sugar and another compound by replacement of a hydroxyl group in the sugar by another group.

Methyl Glycoside

Glycosides formed by the reaction of a sugar with methanol, where the glycosidic bond is between the sugar and the methyl group.

Galactose

A simple sugar (monosaccharide) that is a constituent of lactose, found in milk.