Figure 4-5
-Refer to Figure 4-5. The figure above represents the market for pecans. Assume that this is a competitive market. At a quantity of 12,000 pounds
A) the marginal cost of pecans is greater than the marginal benefit; therefore, output is inefficiently low.
B) producers should lower the price to $3 in order to sell the quantity demanded of 12,000.
C) the marginal cost of pecans is greater than the marginal benefit; therefore, output is inefficiently high.
D) the marginal benefit of pecans is greater than the marginal cost; therefore, output is inefficiently high.

Question

Figure 4-5 
-Refer to Figure 4-5. The figure above represents the market for pecans. Assume that this is a competitive market. At a quantity of 12,000 pounds
A) the marginal cost of pecans is greater than the marginal benefit; therefore, output is inefficiently low. 
B) producers should lower the price to $3 in order to sell the quantity demanded of 12,000. 
C) the marginal cost of pecans is greater than the marginal benefit; therefore, output is inefficiently high. 
D) the marginal benefit of pecans is greater than the marginal cost; therefore, output is inefficiently high.

Quizplus · Accepted Answer

At a quantity of 12,000 pounds, if the marginal cost is greater than the marginal benefit, it indicates that the cost of producing an additional unit exceeds the benefit derived from it, leading to inefficiently high output.

Figure 4-5 -Refer to Figure 4-5. the Figure Above Represents the Market