QUESTION 3: Refer to the graph below and answers the following questions. AllIUnderling work must be shown to earn full credit.Supply4Demand4080120160A Refer to the graph above. When the market is in equilibrium, consumer sumplus is equal to:A) 160B) 320C) 240D) 80B. Refer to the graph above. When the market is in equilibrium, producer surplus is equal to:C) 80.A) 160B) 240.D) 320.C. Refer to the graph above. With an effective price ceiling at $2, total consumer surplus would be:A)240B) 200C) 160.D) 320.D. Refer to the graph above. The effective price ceiling at $2 increases the amount of a productthat consumers buy to120 units, therefore all consumers in this market are better off with the price ceilingat $2. Briefly explain your choice of answer.TRUE (FALSE (E. Refer to the graph above. With an effective price ceiling at $2, the reduction in economic surplus andmarket efficiency would be:A) 0.B) 160C) 40D) 80F. Refer to your answer above. How the market efficiency can be restored?2.8.

Consumer surplus is the area above the price line and the below the demand curve. Producer surplus…

A. Refer to the graph above. When the market is in equilibrium, consumer surplus is equal to: A) 160 C) 240 B) 320 D) 80 B. Refer to the graph above. When the market is in equilibrium, producer surplus is equal to: C) 80. A) 160 B) 240. D) 320. C. Refer to the graph above. With an effective price ceiling at $2, total consumer surplus would be: A) 240 B) 200 C) 160. D) 320.

A. Refer to the graph above. When the market is in equilibrium, consumer surplus is equal to: A) 160 C) 240 B) 320 D) 80 B. Refer to the graph above. When the market is in equilibrium, producer surplus is equal to: C) 80. A) 160 B) 240. D) 320. C. Refer to the graph above. With an effective price ceiling at $2, total consumer surplus would be: A) 240 B) 200 C) 160. D) 320.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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