Suppose the market demand for milk is Qd = 150 - 5P. Additionally, suppose that a dairy's variable costs are VC = 2Q2 (where Q is the number of gallons of milk produced each day), its marginal cost is MC = 4Q and there is an avoidable fixed cost of $50 per day. In the long run there is free entry into the market. What is the market equilibrium price?
A. $50 per gallon
B. $20 per gallon
C. $100 per gallon
D. $25 per gallon
B. $20 per gallon
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International trade between two countries
A) benefits only the receiving country. B) benefits only the sending country. C) benefits both countries. D) benefits neither country.
The economic role of the legal system might best be described as
A) promoting the productive efficiency of competitive markets. B) identifying and producing public goods. C) establishing the "rules of the game" and acting as a referee when disputes arise among market participants. D) identifying and producing merit goods.
Nonprice competition, price leadership, and cartels are models in the ____ market structure(s)
a. perfectly competitive b. monopolistically competitive c. oligopoly d. monopoly e. perfectly competitive and monopolistically competitive
Drive with Us is an automobile retailer and pays floor plan financing to finance the cars they hold in inventory. If the interest rate on their floor plan financing is 6 percent, how much do they pay in interest per day on a car with a wholesale price of $50,000?
A) $5.75 B) $7.57 C) $9.50 D) $8.22