(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 $2.The table shows the market demand schedule for gadgets.If the industry was a perfectly competitive industry, the output would be gadgets, and the
Price would be _.
A)0; $10.
B)500; $5.
C)600; $4.
D)800; $2.

Question

Quizplus · Accepted Answer

In a perfectly competitive market, price equals marginal cost. Since the marginal cost is $2, the price would be $2, and the output would be 800 gadgets, where the price equals the marginal cost.

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