Scenario: Suppose a competitive market has ten buyers and ten sellers. The product exchanged in this market is beach hats, which are indivisible. The following table shows the reservation values for both buyers and sellers.

-Refer to the scenario above.If the market is perfectly competitive,the equilibrium quantity of hats is ________.
A) 6
B) 5
C) 10
D) 4

Question

Scenario: Suppose a competitive market has ten buyers and ten sellers. The product exchanged in this market is beach hats, which are indivisible. The following table shows the reservation values for both buyers and sellers.
 
-Refer to the scenario above.If the market is perfectly competitive,the equilibrium quantity of hats is ________.
A) 6 
B) 5 
C) 10 
D) 4

Quizplus · Accepted Answer

The equilibrium quantity in a perfectly competitive market is where the supply curve intersects the demand curve. In this case, the equilibrium quantity is 6 hats.

Scenario: Suppose a Competitive Market Has Ten Buyers and Ten