Scenario 12.2: Suppose a Stream Is Discovered Whose Water Has Remarkable Healing

Multiple Choice

Scenario 12.2:
Suppose a stream is discovered whose water has remarkable healing powers. You decide to bottle the liquid and sell it. The market demand curve is linear and is given as follows:
P = 30 - Q
The marginal cost to produce this new drink is $3.
-Refer to Scenario 12.2. What will be the price of this new drink in the long run if the industry is a Stackelberg duopoly?

A) $3
B) $9
C) $12
D) $13.50
E) none of the above