Asked by Geneiva Kaarto on Apr 29, 2024
Verified
(Figure: Consumer and Producer Surplus) Look at the figure Consumer and Producer Surplus.If the price is held above equilibrium,consumer surplus will be _____ if the market were in equilibrium and total surplus will be _____ if the market were in equilibrium.
A) greater than;less than
B) less than;the same as
C) greater than;the same as
D) less than;less than
Consumer Surplus
Consumer surplus is the difference between the total amount that consumers are willing and able to pay for a good or service and the total amount that they actually pay.
Total Surplus
The sum of consumer surplus and producer surplus in a market, representing the total benefits to society from the trade of goods or services.
Equilibrium
A state of balance where demand equals supply in a market, leading to a stable price.
- Gain insight into how price limits influence market surplus.
- Assess the total, consumer, and producer surplus based on given market conditions.
Verified Answer
Learning Objectives
- Gain insight into how price limits influence market surplus.
- Assess the total, consumer, and producer surplus based on given market conditions.
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