Figure 7-1 Price P₂ P₁ A B e 8₂2 C E Q₁ Demand Quantity Refer to Figure 7-1. What does area C represent? O a. a decrease in consumer surplus to each consumer in the market when the price. falls from P2 to Pl O b. the decrease in consumer surplus to new consumers who enter the market when the price falls from P2 to P1 c. the increase in consumer surplus to new consumers who enter the market when the price falls from P2 to P1 O d. an increase in producer surplus when quantity sold increases from Q2 to Q1 NEXT PAGE

Figure 7-1 Price P₂ P₁ A B e 8₂2 C E Q₁ Demand Quantity Refer to Figure 7-1. What does area C represent? O a. a decrease in consumer surplus to each consumer in the market when the price. falls from P2 to Pl O b. the decrease in consumer surplus to new consumers who enter the market when the price falls from P2 to P1 c. the increase in consumer surplus to new consumers who enter the market when the price falls from P2 to P1 O d. an increase in producer surplus when quantity sold increases from Q2 to Q1 NEXT PAGE

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Figure 7-1 Demand A B D QUANTITY Refer to Figure 7-1. Suppose that the price falls from P2 to P1 Area B represents the O a. decrease in producer surplus in the market when the price increases from P1 to P2. b. decrease in producer surplus that results from a downward-sloping demand curve. Oc.consumer surplus to new consumers who enter the market. O d. additional consumer surplus to initial consumers when the price falls. PRICE
What is the consumer surplus when the price is $20? Price 40 35 + 30 25 + 20 15 10 D 10 20 30 40 s0 60 70 00 Duantity Select one: O a. $20 O b. $1000 O. $500 O d. $50
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Question 21
Price $60 40 20 0 50 100 Quantity 150 O $60, resulting in a surplus of 100 units. O $60, resulting in a shortage of 100 units. $40, resulting in equilibrium. O $20, resulting in a shortage of 100 units. 200 Supply Demand Refer to the above diagram. A price floor could be established at:
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The graph shows the demand curve and the supply curve in the market for newpapers. Draw a horizontal line at a price at which there is a surplus of newpapers. Label it Surplus.