Use the figure below to answer the following question(s). Figure 6-2
Figure 6-2 illustrates the four possibilities of the structure of production and consumption for a good or service. In which case is the incentive of producers to be efficient and the incentive for consumers to economize the weakest?

Question

Use the figure below to answer the following question(s). Figure 6-2
 Figure 6-2 illustrates the four possibilities of the structure of production and consumption for a good or service. In which case is the incentive of producers to be efficient and the incentive for consumers to economize the weakest?

Quizplus · Accepted Answer

In option D, there is a monopoly seller and a single buyer, which typically results in a lack of competition and a stronger bargaining power for the seller. This diminishes the incentive for the seller to be efficient, while the buyer has little bargaining power and may not be motivated to economize. Thus, the incentive for both parties to be efficient and economize is the weakest in option D.

Use the Figure Below to Answer the Following Question(s)