(Table: Demand Schedule for Gadgets) Look at the table Demand Schedule for Gadgets.The market for gadgets is dominated by two producers, Margaret and Ray.Each firm can produce gadgets at a marginal cost of $0.The table shows the market demand schedule for gadgets.If industry output is 350 gadgets produced by Margaret and 250 gadgets produced by Ray and if Ray decides to increase output by 100, industry price will be:
A)$3.
B)$2.
C)$1.
D)$0.

Question

Quizplus · Accepted Answer

When Ray increases output by 100, the total industry output becomes 700 gadgets. According to the demand schedule, at a quantity of 700, the market price is $3.

(Table: Demand Schedule for Gadgets) Look at the Table Demand