The Figure Given Below Represents Two Monopolists James and Jerry

Multiple Choice

The figure given below represents two monopolists James and Jerry.James produces Good A using the input Good B which is produced by Jerry and has no other variable costs.James is the only consumer of Good B, and the marginal cost incurred by Jerry to produce Good B is zero.DA and DB represent the demand curves for Good A and Good B respectively.MRA and MRB represent the marginal revenue received from Good A and Good B respectively.It takes one unit of A to produce a unit of B.


-Refer to Figure.Which of the following agreements between James and Jerry would be feasible?

A) James pays Jerry an amount above $48 only if Jerry agrees to produce 8 units.
B) James pays Jerry and amount below $24 only if Jerry agrees to produce 8 units.
C) James pays Jerry an amount above $24 only if Jerry agrees to produce 8 units.
D) James pays Jerry an amount below $12 only if Jerry agrees to produce 8 units.