Part 1In the figure, when the quantity equals 400 pretzels, A. producers are willing to supply 400 pretzels for $2. B. consumers are willing to pay $2 for the 400th pretzel. C. producers are willing to supply 400 pretzels for $3. D. the marginal benefit is greater than the marginal cost.

Question

Part 1In the​ figure, when the quantity equals 400​ pretzels, A. producers are willing to supply 400 pretzels for​ $2. B. consumers are willing to pay​ $2 for the 400th pretzel. C. producers are willing to supply 400 pretzels for​ $3. D. the marginal benefit is greater than the marginal cost.

BlackTom AI · Accepted Answer

Let's restate the problem to anchor our discussion: In the figure, when the quantity equals 400 pretzels, which statement is true?

Option A: 'producers are willing to supply 400 pretzels for $2.' This would imply the supply price at Q=400 is $2. If the correct interpretation of the supply curve in the figure shows a higher price at Q=400, then this would be false. Often, in many supply curves, the quantity supplied at a given price reflects producers' willingness to sell at that price; if the figure indicates a price of $3 at Q=400, then $2 is too low.

Option B: 'consumers are willing to pay $2 for the 400th pretzel.' This describes the marginal value to consumers for the 400th unit, i.e., the marginal benefit to the buyer. If the implied marginal benefit at Q=400 is $3 or another value, then stating $2 would be incorrect. This would mix up consumer willingness to pay with producer price in a supply context.

Option C: 'producers are willing to supply 400 pretzels for $3.' This aligns with the idea that at quantity Q=400, the price given by the supply side is $3, meaning producers are willing to sell up to 400 units at that price or higher. If the supply curve shows a price of $3 corresponding to Q=400, this statement is consistent with the model.

Option D: 'the marginal benefit is greater than the marginal cost.' This statement compares marginal benefit and marginal cost. Without the graph’s exact values for marginal benefit and marginal cost at Q=400, we cannot assert this as true. The relationship could be equal, greater, or less depending on the curve details; assuming the figure pins Q=400 to a specific price, this broad claim may not be supported.

To deepen the reasoning, consider the linkage between quantity and price on a typical supply schedule: at a given quantity, the price producers require is the price that clears the market for that quantity, assuming other factors constant. If the figure indicates that at Q=400 the market price is $3, then option C correctly states that producers are willing to supply that amount at that price. Misstating the price (as in option A) would misread the supply point. Misinterpreting the consumer side (option B) conflates willingness to pay with what producers receive; the graph usually shows consumer willingness at different quantities as marginal benefit, which is not directly equal to the supply price. Finally, option D requires knowing the exact marginal values; without that, declaring a definite inequality between marginal benefit and marginal cost cannot be justified.

Homework:ch5_hw

Part 1In the figure, when the quantity equals 400 pretzels, A. producers are willing to supply 400 pretzels for $2. B. consumers are willing to pay $2 for the 400th pretzel. C. producers are willing to supply 400 pretzels for $3. D. the marginal benefit is greater than the marginal cost.

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