Figure 4-6
Figure 4-6 shows the market for granola. The market is initially in equilibrium at a price of P₁ and a quantity of Q₁. Now suppose producers decide to cut output to Q₂ in order to raise the price to P₂.
-Refer to Figure 4-6.At the price P₂,consumers are willing to buy the Q₂ pounds of granola.Is this an economically efficient quantity?

Question

Figure 4-6
  Figure 4-6 shows the market for granola. The market is initially in equilibrium at a price of P₁ and a quantity of Q₁. Now suppose producers decide to cut output to Q₂ in order to raise the price to P₂.
-Refer to Figure 4-6.At the price P₂,consumers are willing to buy the Q₂ pounds of granola.Is this an economically efficient quantity?

Quizplus · Accepted Answer

The quantity is not economically efficient if the marginal benefit exceeds the marginal cost, as it indicates that consumers value the product more than it costs to produce, suggesting potential for increased production.

Figure 4-6 Figure 4-6 Shows the Market for Granola. the Granola