-The above diagram (a)represents the demand for and supply of a brand of automobile (Turbo-car)for a car manufacturing company named Fancy Auto.Assume that D_L represents low demand for the Turbo-car,D_M represents the medium level of demand and,D_H represents the high level of demand for Turbo-car and Fancy Auto's optimal output level is 900 cars per week.If the prices are flexible,Fancy Auto: A) can continue to sell its optimal output regardless of the demand level. B) can continue producing its optimal output level only if demand is at D_L level. C) can continue producing its optimal output level only if demand is at D_M level. D) can continue producing its optimal output level only if demand is at D_H level.

Question

Quizplus · Accepted Answer

Fancy Auto can continue producing its optimal output level only if demand is at D_L level.

-The Above Diagram (A)represents the Demand for and Supply of a Brand