Question

Assume there are three hardware stores, each willing to sell one standard model hammer in a given time period. House Depot can offer their hammer for a minimum of $7. Lace Hardware can offer the hammer for a minimum of $10. Bob's Hardware store can offer the hammer at a minimum price of $13.

Given the scenario described, if the market price of hammers decreased from $15 to $11.What would be the outcome?

Answer 1

If the market price of hammers decreased from $15 to $11 given the given scenario, all three hardware stores would be able to sell their hammers at prices within this range, resulting in competition among them.

Step-by-step explanation:

If the market price of hammers decreased from $15 to $11 given the given scenario, the outcome would be that all three hardware stores would be able to sell their hammers. House Depot, Lace Hardware, and Bob's Hardware store can all offer their hammers at prices lower than the market price of $11.

House Depot can offer their hammer for a minimum of $7, which is lower than $11.

Lace Hardware can offer the hammer for a minimum of $10, which is also lower than $11.

Bob's Hardware store can offer the hammer at a minimum price of $13, which is higher than $11 but still within the market price range.

Therefore, all three hardware stores would be able to sell their hammers, resulting in competition among them.