Question

explain why in a market situation high cost producers are unlikely to produce the goods or...

explain why in a market situation high cost producers are unlikely to produce the goods or services in a market and why low benefit consumers are unlikely to get lettuce

Homework Answers

Answer #1

Answer : In a market high production cost raise the price level which decrease the maket demand for the product or service, according to the demand law. If demand decrease then producer reduce their production to maximize profit in the short run time period but in long run time period producers either exit from the market or do not be ready to produce.

On the other hand, consumers always try to maximize their utilities. In this case if consumers gets low benefit from lettuce consumption and lettus has market substitutes which gives maximum benefits then consumers go to buy substitute goods which decrease the demand for lettuce. Hence consumers do not want to get lettuce.

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Assume a competitive market for oil. Low-cost producers can produce 2 million barrels at $20 per...
Assume a competitive market for oil. Low-cost producers can produce 2 million barrels at $20 per barrel. Medium-cost producers can produce 10 million barrels at $30 per barrel. High-cost producers can produce 10 million barrels at $40 per barrel. If demand is perfectly inelastic at 5 million barrels, what is the equilibrium price of oil? a) $40 b) $30 c) $25 d) $24 e) $20
What are the two characteristics of public goods? Why is it that private producers do not...
What are the two characteristics of public goods? Why is it that private producers do not “produce” public goods like national defense? Explain your answer below in no more than four sentences.
It costs $10 to produce a low-quality wallet and 420 to produce a high-quality wallet. Consumers...
It costs $10 to produce a low-quality wallet and 420 to produce a high-quality wallet. Consumers cannot distinguish between the products before purchase, they do not make repeat purchases, and they value the wallets at the cost of production. The five firms in the market produce 100 wallets each. Each firm produces only high-quality or only low-quality wallets. Consumers pay the expected value of a wallet. If all five firms initially produce low-quality wallets, could any one firm increase its...
Intensive distribution is typically associated with low-cost ________. Convenience goods Durable goods Impulse goods High-technology goods...
Intensive distribution is typically associated with low-cost ________. Convenience goods Durable goods Impulse goods High-technology goods Shopping goods 2 points    It is said that customers do not buy goods or services: They buy ________. Offerings that render services that create value Products that come with some services Technology that is a service orientation Services that come in a variety of sizes and shapes All of these 2 points    It is said that services are ________ rather than produced....
Identify an economic marketplace that isn't regulated enough? Why? Would more regulations in this market place...
Identify an economic marketplace that isn't regulated enough? Why? Would more regulations in this market place benefit consumers? Producers?
why the market for health care services is substanially different than the market for typical goods...
why the market for health care services is substanially different than the market for typical goods and services
Well-meaning individuals sometimes argue that the government should use price floors to ensure high prices for...
Well-meaning individuals sometimes argue that the government should use price floors to ensure high prices for the producers of some goods and services (e.g., airline travel, trucking, milk, and low skilled labor). At this point, you should be able to explain in some detail why economists believe that this policy usually is a bad idea. Briefly do so.
Many people – including retailers, hawkers and consumers buy their fresh produce at one of the...
Many people – including retailers, hawkers and consumers buy their fresh produce at one of the National Fresh Produce Markets (NFPMs) in South Africa. Most of the fresh fruit and vegetable producers supply their products to these NFPMs. The price of potatoes varies daily because the price is determined by supply and demand, as one would expect in this type of market structure. Prices are displayed to the buyers and sellers of potatoes at the fresh produce markets and this...
Explain why or why not the Consumer Price Index includes changes in purchases that consumers make...
Explain why or why not the Consumer Price Index includes changes in purchases that consumers make when the prices of goods and services change.
What is Market Making? a) It transfers goods from low value use to high value use...
What is Market Making? a) It transfers goods from low value use to high value use hence wealth is created. b) Market making cannot take place if transaction costs are very high thereby to prevent value creating transactions. c) It brings high value buyers and low value sellers together. d) all of the above