Use the following to answer questions : $$\begin{array}{l}
\text { Table: Lunch }\
\begin{array} { r c }
\hline \text { Price } & \begin{array} { c }
\text { Quantity } \
\text { Demanded }
\end{array} \
\hline \$ 10 & 0 \
9 & 10 \
8 & 20 \
7 & 30 \
6 & 40 \
5 & 50 \
4 & 60 \
\hline
\end{array}
\end{array}$$
-(Table: Lunch)Use Table: Lunch.This table shows market demand for picnic lunches for people taking all-day rafting trips on the river.Suppose that the marginal cost and average cost of each lunch are a constant $4 for all firms in the market.What is deadweight loss in this market in the long run?
A) $0
B) $4
C) $180
D) $360

Question

Use the following to answer questions : $$\begin{array}{l}
\text { Table: Lunch }\
\begin{array} { r c } 
\hline \text { Price } & \begin{array} { c } 
\text { Quantity } \
\text { Demanded }
\end{array} \
\hline \$ 10 & 0 \
9 & 10 \
8 & 20 \
7 & 30 \
6 & 40 \
5 & 50 \
4 & 60 \
\hline
\end{array}
\end{array}$$
-(Table: Lunch)Use Table: Lunch.This table shows market demand for picnic lunches for people taking all-day rafting trips on the river.Suppose that the marginal cost and average cost of each lunch are a constant $4 for all firms in the market.What is deadweight loss in this market in the long run?
A) $0
B) $4
C) $180
D) $360

Quizplus · Accepted Answer

In the long run, firms will produce where price equals marginal cost, which is $4. At this price, the quantity demanded is 60, and there is no deadweight loss because the market is efficient.

Use the Following to Answer Questions -(Table: Lunch)Use Table: Lunch