Table 17-10
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.

-Refer to Table 17-10.Suppose we observe that the price of a gallon of gasoline in Driveaway is $2.Given this observation,which of the following scenarios is most likely?
A) There is one seller of gasoline in Driveaway.
B) There are two sellers of gasoline in Driveaway.
C) There are a few sellers of gasoline in Driveaway, but the number of sellers exceeds two.
D) There are many sellers of gasoline in Driveaway.

Question

Table 17-10
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.
 
-Refer to Table 17-10.Suppose we observe that the price of a gallon of gasoline in Driveaway is $2.Given this observation,which of the following scenarios is most likely?
A) There is one seller of gasoline in Driveaway. 
B) There are two sellers of gasoline in Driveaway. 
C) There are a few sellers of gasoline in Driveaway, but the number of sellers exceeds two. 
D) There are many sellers of gasoline in Driveaway.

Quizplus · Accepted Answer

In order for the gasoline sellers to be willing to sell gasoline at a price of $2, they must be able to cover their costs of $2 per gallon. If there were only one or two sellers in the market, they would not be able to cover their costs at a price of $2 per gallon. Therefore, it is most likely that there are many sellers in the market, which allows for competition and for sellers to offer gasoline at a price that covers their costs.

Table 17-10 the Table Shows the Town of Driveaway's Demand Schedule for Schedule