Table 16-3 Imagine a Small Town in Which Only Two Residents, Robert

question 58

Multiple Choice

Table 16-3
Imagine a small town in which only two residents, Robert and John, own wells that produce water for safe drinking. Each Saturday, Robert and John work together to decide how many litres of water to pump, bring the water to town, and sell it at whatever price the market will bear. To keep things simple, suppose that Robert and John can pump as much water as they want without cost; therefore, the marginal cost of water equals zero.
The weekly town demand schedule and total revenue schedule for water are shown in the table.

-Refer to Table 16-3. As long as Robert and John operate as a profit-maximising monopoly, what will their weekly revenue be?

• A) $270
• B) $320
• C) $350
• D) $360

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Definitions:

Felony

As a general rule, all crimes punishable by death or by imprisonment in a state prison.

Misdemeanor

Any crime that is punishable neither by death nor by imprisonment in a state prison.

Serious Crime

An act, typically involving violence, regarded by society as being particularly harmful or dangerous, and punishable by severe penalties including imprisonment.

Probation

A period of supervision over an offender, ordered by a court instead of serving time in prison, allowing the person to remain in the community under specific conditions.