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Question
Maries Car Dealership is the only dealership in Victorville, California. The owner, Marie, experiences large economies of scale. Because she is the only seller of cars in the town,
a. Marie has market power.
b. Marie has no market power and must price at marginal cost.
c. Marie can charge any price she wants and will still sell the number of cars that maximize her profits.
d. consumer surplus is maximized in the car market.
e. total economic surplus is maximized in the car market.
Answer
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