Quiz 9 Consumer's and Producer's Surplus

Figure 7-24. The equilibrium allocation of resources is

efficient because total surplus is maximized at the equilibrium.

Figure 7-24. At equilibrium, total surplus is

$54.

Figure 7-24. At equilibrium, consumer surplus is

$18.

Figure 7-23. The equilibrium price is

P2.

Figure 7-24. At equilibrium, producer surplus is

$36

Figure 7-24. At equilibrium, total surplus is measured by the area

ABD.

Figure 7-24. At equilibrium, consumer surplus is measured by the area

AFB

Figure 7-24. If the government imposes a price floor at $18, then consumer surplus is

AGH.

Figure 7-24. At equilibrium, producer surplus is measured by the area

BDF.

Figure 7-24. If the government imposes a price ceiling at $12, then producer surplus is

CDI.

Figure 7-24. If 6 units of the good are produced and sold, then

efficiency is achieved in this market. the marginal value to buyers equals the marginal cost to sellers. the sum of consumer surplus and producer surplus is maximized.

Figure 7-24. If 10 units of the good are produced and sold, then

the marginal cost to sellers exceeds the marginal value to buyers.

Figure 7-24. If 6 units of the good are produced and sold, then

the sum of consumer surplus and producer surplus is maximized.

Figure 7-24. If 4 units of the good are produced and sold, then

total surplus is not maximized.