Question

Suppose a student values a textbook at $50, and the publisher is unwilling to sell the textbook at a price lower than $30. What price will lead to an efficient transaction between the student and publisher?
A) a price of $0
B) any price greater than $0 and less than $30
C) any price greater than or equal to $30 and less than or equal to $50
D) any price greater than $50

Answer 1

Answer:

C) any price greater than or equal to $30 and less than or equal to $50

Explanation:

$50 represents the highest amount the student is willing to buy the textbook. She would be willing to buy the textbook at any price equal or below $50.

$30 represents the lowest amount the publisher is willing to sell his textbook. He would accept any price equal or greater than $30.

For an efficient trade to take place, the price of the textbook has to be between $30 And $50.

I hope my answer helps you