Suppose That King Kanuta, Whom You Met in Your Workbook

question 3

Multiple Choice

Suppose that King Kanuta, whom you met in your workbook, demands that each of his subjects give him 2 coconuts for every coconut that they consume. The king puts all of the coconuts that he collects in a large pile and burns them. The supply of coconuts is given by S(p_s) = 100p_s, where p_s is the price received by suppliers. The demand for coconuts by the king's subjects is given by D(p_d) = 6,000 - 100p_d, where p_d is the price paid by consumers. In equilibrium, the price received by suppliers will be

• A) $30.
• B) $18.
• C) $90.
• D) $27.
• E) None of the above

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Definitions:

Conditional Sales Contract

A contract arrangement in which the sale is conditional upon specific terms, with the transfer of ownership from the seller to the buyer occurring only after these conditions are met.

Title Transfer

The legal process of transferring ownership of a property or asset from one party to another.

Transaction

An exchange or transfer of goods, services, or funds between parties.

Unsecured Creditor

A creditor who has extended credit without obtaining any collateral, making them more vulnerable in the event of debtor default.