Use the figure below to answer the following question.
The area that identifies the maximum sum of consumer surplus and producer surplus is
A. a + b + e.
B. a + b + c + d.
C. a + b + c + d + e + f.
D. c + d + f.
Answer: B
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All of the following are economic resources, or factors of production EXCEPT
A) land. B) physical capital. C) money. D) entrepreneurship.
For a perfectly competitive firm
A) price is greater than marginal revenue. B) price equals marginal revenue. C) price is less than marginal revenue. D) there is no relationship between price and marginal revenue.
Figure 11-3
In Figure 11-3, one can tell from the graph that the monopolist will earn a positive profit only if
A. the price exceeds $3. B. the price exceeds $2. C. output is less than 60 units. D. One cannot tell from the information given.
Consider an unregulated monopoly in Figure 8.13. If a second firm enters the market, the demand curve facing the first firm will:
A. shift to the right. B. shift to the left. C. remain the same. D. There is insufficient information.