Use the figure below to answer the following questions.

Figure 16.2.1
-Refer to Figure 16.2.1. The figure shows the marginal private cost curve, the marginal social cost curve and the market demand curve. If the market is unregulated, then the price is
A)P₁.
B)P₄.
C)below P₁.
D)P₂.
E)P₃.

Question

Use the figure below to answer the following questions.
  
Figure 16.2.1
-Refer to Figure 16.2.1. The figure shows the marginal private cost curve, the marginal social cost curve and the market demand curve. If the market is unregulated, then the price is
A)P₁. 
B)P₄. 
C)below P₁. 
D)P₂. 
E)P₃.

Quizplus · Accepted Answer

In an unregulated market, the price is determined by the intersection of the market demand curve and the marginal private cost curve, which is at P₂.

Use the Figure Below to Answer the Following Questions