Table 17-5
The table shows the town of Driveaway's demand schedule for gasoline. Assume the town's gasoline seller(s) incurs a cost of $2 for each gallon sold, with no fixed cost.

$$\begin{array} { | c | c | c | }
\hline \begin{array} { c }
\text { Quantity } \
\text { (Gallons) }
\end{array} & \begin{array} { c }
\text { Price } \
\text { (Dollars per gallon) }
\end{array} & \begin{array} { c }
\text { Total Revenue } \
\text { (Dollars) }
\end{array} \
\hline 0 & 8 & 0 \
\hline 50 & 7 & 350 \
\hline 100 & 6 & 600 \
\hline 150 & 5 & 750 \
\hline 200 & 4 & 800 \
\hline 250 & 3 & 750 \
\hline 300 & 2 & 600 \
\hline 350 & 1 & 350 \
\hline 400 & 0 & 0 \
\hline
\end{array}$$
-Refer to Table 17-5. If the market for gasoline in Driveaway is perfectly competitive, then the equilibrium price of gasoline is

Question

Table 17-5
The table shows the town of Driveaway's demand schedule for gasoline. Assume the town's gasoline seller(s) incurs a cost of $2 for each gallon sold, with no fixed cost.
​
​
 $$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Quantity } \
\text { (Gallons) }
\end{array} & \begin{array} { c } 
\text { Price } \
\text { (Dollars per gallon) }
\end{array} & \begin{array} { c } 
\text { Total Revenue } \
\text { (Dollars) }
\end{array} \
\hline 0 & 8 & 0 \
\hline 50 & 7 & 350 \
\hline 100 & 6 & 600 \
\hline 150 & 5 & 750 \
\hline 200 & 4 & 800 \
\hline 250 & 3 & 750 \
\hline 300 & 2 & 600 \
\hline 350 & 1 & 350 \
\hline 400 & 0 & 0 \
\hline
\end{array}$$
-Refer to Table 17-5. If the market for gasoline in Driveaway is perfectly competitive, then the equilibrium price of gasoline is

Quizplus · Accepted Answer

In a perfectly competitive market, the equilibrium price is where the cost equals the price consumers are willing to pay. Since the cost per gallon is $2, and at a price of $2, 300 gallons are demanded, this is the equilibrium point.

Table 17-5 the Table Shows the Town of Driveaway's Demand

Table 17-5
the Table Shows the Town of Driveaway's Demand