Price, marginal cost (S) The diagram illustrates the demand curve, isoprofit curves and the marginal cost curve of MQ2020, a luxury car manufactured by MO Motors. Ass currently chooses to operate at Point E. Which statement correctly describes the market of MQ2020? 10.000- Megiat cout eproit cuve P.55.440 bepr curve Demand ue 10 20 Q-32 120 Quantity of cars. Q Select one: O. MO Motors is not maximising its profits as total surplus is not being maximised. Ob. Deadweight loss is the loss incurred by MQ Motors for not selling more cars. Oe Pareto efficient allocation is currently being achieved. Od. The amount of total surplus is the area ABD. Oe The amount of consumer surplus is the area AEP
Price, marginal cost (S) The diagram illustrates the demand curve, isoprofit curves and the marginal cost curve of MQ2020, a luxury car manufactured by MO Motors. Ass currently chooses to operate at Point E. Which statement correctly describes the market of MQ2020? 10.000- Megiat cout eproit cuve P.55.440 bepr curve Demand ue 10 20 Q-32 120 Quantity of cars. Q Select one: O. MO Motors is not maximising its profits as total surplus is not being maximised. Ob. Deadweight loss is the loss incurred by MQ Motors for not selling more cars. Oe Pareto efficient allocation is currently being achieved. Od. The amount of total surplus is the area ABD. Oe The amount of consumer surplus is the area AEP
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Price, marginal cost (S)
The diagram illustrates the demand curve, isoprofit curves and the marginal cost curve of MQ2020, a luxury car manufactured by MQ Motors. Assume that MQ Motors
currently chooses to operate at Point E. Which statement correctly describes the market of MQ2020?
10.000
Marginal cout
seprofit curve
$150.000
P-$5,440
iseprofit curve
Demand curve
10 20 Q- 32
120
Quantity of cars, Q
Select one:
O a. MQ Motors is not maximising its profits as total surplus is not being maximised.
Ob. Deadweight loss is the loss incurred by MQ Motors for nat selling more cars.
Oc. Pareto efficient allocation is currently being achieved.
Od. The amount of total surplus is the area ABD.
Oe. The amount of consumer surplus is the area AEP
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