Table 7-14
The only four producers in a market have the following costs:

-Refer to Table 7-14. If the sellers bid against each other for the right to sell the good to a single consumer, then the good will sell for
A) $30 or slightly more.
B) $40 or slightly less.
C) $55 or slightly less.
D) $65 or slightly less.

Question

Table 7-14
The only four producers in a market have the following costs:
 
-Refer to Table 7-14. If the sellers bid against each other for the right to sell the good to a single consumer, then the good will sell for
A) $30 or slightly more. 
B) $40 or slightly less. 
C) $55 or slightly less. 
D) $65 or slightly less.

Quizplus · Accepted Answer

In a competitive bidding scenario, the seller with the lowest cost will win the bid. In this case, Seller A has the lowest cost at $20. Thus, the good will sell for slightly less than the second-lowest cost, which is $40 (the cost of Seller B). Therefore, the good will sell for around $40 or slightly less. Option B is the closest answer.

Table 7-14 The Only Four Producers in a Market Have the Following