Suppose that the equilibrium price in the market for tomatoes is $3 per pound. If a law reduced the maximum legal price for tomatoes to $2 per pound,
a. any possible increase in consumer surplus would be larger than the loss of producer surplus.
b. any possible increase in consumer surplus would be smaller than the loss of producer surplus.
c. the resulting increase in producer surplus would be larger than any possible loss of consumer surplus.
d. the resulting increase in producer surplus would be smaller than any possible loss of consumer surplus.
b
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An individual transferable quota can be used to achieve the
A) equilibrium for a public good. B) efficient use of a common resource. C) equilibrium for a private good. D) equilibrium for a common resource.
At the point on the demand curve at which marginal revenue = 0, the absolute value of the coefficient of the price elasticity of demand is:
A) > 1. B) = 1. C) < 1. D) = 0.
The law of diminishing marginal returns per worker states that beyond some point:
a. marginal satisfaction declines per unit. b. decreases in capital per worker add more to output per worker. c. marginal satisfaction increases per unit. d. increases in capital per worker add less to output per worker.
"Right-to-work" laws
A. make it harder for unions to organize. B. make it easier for unions to organize. C. have no effect on union organizing.