Table 16-4 Beatrice's Birthday Cakes Operates in a Monopolistically Competitive Market, So

Table 16-4
Beatrice's Birthday Cakes operates in a monopolistically competitive market, so it is one bakery among many in the market for birthday cakes. The following table presents cost and revenue data for birthday cakes at Beatrice's.
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-Refer to Table 16-4. Suppose the government forced Beatrice's to produce at the efficient scale of output. Who would be better off as a result of this policy? Who would be worse off as a result of this policy?

A) Beatrice's would be better off; consumers would be worse off.
B) Consumers would be better off; Beatrice's would be worse off.
C) No one would be better off; consumers would be worse off.
D) No one would be better off; no one would be worse off.

Correct Answer:

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