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-(Table: Demand Schedule of Gadgets)Use Table: Demand Schedule of Gadgets.The market for gadgets consists of two producers,Margaret and Ray.Each firm can produce gadgets at a marginal cost of $2 and no fixed cost.If industry output is 300 gadgets produced by Margaret and 200 gadgets produced by Ray and if Ray decides to increase output by an additional 100 gadgets,industry price will be:
A)$4.
B)$3.
C)$2.
D)$1.

Question

Use the following to answer question: 
-(Table: Demand Schedule of Gadgets)Use Table: Demand Schedule of Gadgets.The market for gadgets consists of two producers,Margaret and Ray.Each firm can produce gadgets at a marginal cost of $2 and no fixed cost.If industry output is 300 gadgets produced by Margaret and 200 gadgets produced by Ray and if Ray decides to increase output by an additional 100 gadgets,industry price will be:
A)$4. 
B)$3. 
C)$2. 
D)$1.

Quizplus · Accepted Answer

If Ray increases output by 100 gadgets, the total industry output will be 600 gadgets. The demand schedule shows that at a quantity of 600 gadgets, the market price will be $4.

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