Asked by ESTELA LUCCHESI on May 07, 2024
Verified
The total of consumer plus producer surplus is greatest
A) when consumer surplus is maximized.
B) when producer surplus is maximized.
C) at the market equilibrium.
D) all of the above
Market Equilibrium
The condition in which a market's supply and demand balance each other, and as a result, prices become stable.
- Understand the concept and implications of market equilibrium in maximizing total surplus.
Verified Answer
NS
Nehel ShaikhMay 13, 2024
Final Answer :
C
Explanation :
The total of consumer plus producer surplus is greatest at the market equilibrium because this is where the quantity supplied equals the quantity demanded, leading to the most efficient allocation of resources.
Learning Objectives
- Understand the concept and implications of market equilibrium in maximizing total surplus.