Use the Following Figure to Answer the Question : Figure

question 85

Multiple Choice

Use the following figure to answer the question : Figure 13-2 : shows the market demand curve [DD'],the supply curve of the fringe firms [S_F],the cartel's marginal cost curve [MC₀],and the cartel's marginal revenue curve [MR₀].Assume that the cartel behaves like a dominant firm.
-Refer to Figure 13-2.Which of the following statements is true?

• A)The residual demand curve is less elastic than the market demand curve.
• B)The difference between Q_F and Q₀ represent the inefficiency in output from a monopoly.
• C)The total industry output is equal to TC.
• D)The total industry output is the sum of Q_F and Q₀.

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The minimum amount of equity that a company must maintain to protect creditors, often required by law.

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The total amount of money raised by a company through the sale of shares to shareholders; represents the equity funding of the business.

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The current price at which an asset or service can be bought or sold in a public market.