In the Absence of Government Interference, There Is a Constant

question 28

Multiple Choice

in the absence of government interference, there is a constant marginal cost of $5 per ounce for growing marijuana and delivering it to buyers.If the probability that any shipment of marijuana seized is .30 and the fine if a shipper caught is $50 per ounce, then the equilibrium price of marijuana per ounce is

• A)$28.57.
• B)$20.
• C)$55.
• D)$3.50.
• E)$6.50.

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Definitions:

Days to Sell Inventory

A financial metric measuring the average number of days a company takes to sell its inventory.

Sales

The total amount of revenue generated from goods or services sold by a company.

Costs of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials, labor, and manufacturing overhead.

Inventory

A company's full collection of materials and goods, kept for the goal of being sold or used in production.