Table 17-1 Imagine a Small Town in Which Only Two Residents, Rochelle

question 81

Multiple Choice

Table 17-1
Imagine a small town in which only two residents, Rochelle and Alec, own wells that produce safe drinking water. Each week Rochelle and Alec work together to decide how many gallons of water to pump. They bring the water to town and sell it at whatever price the market will bear. To keep things simple, suppose that Rochelle and Alec can pump as much water as they want without cost so that the marginal cost of water equals zero. The town's weekly demand schedule and total revenue schedule for water is shown in the table below:
-Refer to Table 17-1. Suppose the town enacts new antitrust laws that prohibit Rochelle and Alec from operating as a monopoly. How many gallons of water will be produced and sold once Rochelle and Alec reach a Nash equilibrium?

• A)600
• B)700
• C)800
• D)900

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Definitions:

Authoritative Style

A parenting style characterized by high demands and high responsiveness, encouraging autonomy while setting clear boundaries.

Parenting

The process of promoting and supporting the physical, emotional, social, and intellectual development of a child from infancy to adulthood.

Authoritative Parents

A parenting style characterized by high responsiveness and high demands, where parents set clear standards and are assertive without being intrusive or restrictive.

Authoritarian Parents

A parenting style characterized by high demands and low responsiveness, where parents impose strict rules and expect obedience without question.