Answer the Question on the Basis of the Following Demand

question 60

Multiple Choice

Answer the question on the basis of the following demand and supply data for a competitive market: $\begin{array}{c}\begin{array}{ccc}\text { Quantity Demanded } & \text { Price } \\\hline1,500 & \$ 10 \\2,000 & 9 \\2,500 & 8 \\3,000 & 7 \\3,500 & 6\\\end{array}\begin{array}{c}\text{Quantity Supplied}\\\hline3,500 \\3,000 \\2,500 \\2,000 \\1,500\end{array}\end{array}$ Refer to the given data.If government provides a per-unit subsidy of $2 to suppliers of this product,equilibrium price and quantity would be:

• A) $9 and 3,000.
• B) $7.50 and 2,250.
• C) $8.50 and 2,750.
• D) $7 and 3,000.

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Definitions:

Worker's Time

The amount of time an individual dedicates to labor or employment activities.

Constant Returns

A situation in production where increasing the quantity of inputs results in a proportional increase in the quantity of outputs, indicating a stable relationship between inputs and outputs.

Scale

refers to the size of a business operation or the capacity of a company's production output.

Production Function

An equation or model that describes the relationship between inputs (like labor and capital) and outputs (goods or services) in the production process.