Suppose That in Problem 2, the Demand Curve for Mineral

question 17

Multiple Choice

Suppose that in Problem 2, the demand curve for mineral water is given by p = 70 - 16q, where p is the price per bottle paid by consumers and q is the number of bottles purchased by consumers. Mineral water is supplied to consumers by a monopolistic distributor, who buys from a monopolist producer who is able to produce mineral water at zero cost. The producer charges the distributor a price of c per bottle, that will maximize the producer's total revenue. Given his marginal cost of c, the distributor chooses an output to maximize profits. The price paid by consumers under this arrangement is

• A) $52.50.
• B) $35.
• C) $4.38.
• D) $2.19.
• E) $17.50.

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Definitions:

Goods And Services Deficit

The situation where a country imports more goods and services than it exports, leading to a negative trade balance.

Imports

Goods and services purchased from other countries, contributing to a country's consumption beyond domestic production.

Italy

A country located in southern Europe, known for its rich history, cultural landmarks, and significant contributions to art, food, fashion, and science.

Licensing Agreements

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