Use the following information to answer questions 10 to 15 below:

A small city has a number of hot dog stands operating throughout the CBD area. Suppose that each vendor has a marginal cost of R1,50 per hot dog sold and no fixed cost. Suppose the maximum number of hot dogs that any one vendor can sell is 100 per day.

10.If a hot dog is priced at R2, how many hot dogs would each street vendor want to sell

per day?

[1] 0

[2] 50

[3] 75

[4] 100

11.If the vendor market is perfectly competitive, will the price remain R2 for a hot dog?

[1] Yes, remain at current price of R 2,00

[2] No, change to R 1,00

[3] No, change to R1,50

[4] No, change to R2,50

12.If each vendor sells the maximum 100 hotdogs per day and demand for hot dogs is given

as Q(d) = 4400 - 1200P, what is the total number of vendors in the market in the short

run?

[1] 2 vendors.

[2] 10 vendors.

[3] 15 vendors.

[4] 20 vendors.

13.If each vendor sells the maximum 100 hot dogs per day and demand for hot dogs is Q(d)

= 4400 - 1200P, what is the total number of vendors in the long run?

[1] 0 vendors

[2] 20 vendors

[3] 26 vendors

[4] 56 vendors

14.Suppose the city decides to regulate the market by issuing permits and the demand curve

in Question 12 is given. Suppose the city issues only 20 permits and each vendor sells

100 hot dogs per day, what will be the price of a hot dog?

[1] P = R 1,50

[2] P = R 2,00

[3] P = R 2,50

[4]P = R 3,00