Click on the icon to read the news clip, t The graph shows the market for milk in Vene- Draw a shape that represents: 1) consumer surplus. Label it CS. 2) producer surplus. Label it PS. 3) the deadweight loss. Label it DWL. Also draw a shape that show the resources H Loss. *** Moving from a milk market with no price con consumer surplus and pre A. increases; increases B. increases; decreases OC. decreases; increases OD. decreases; decreases In the market for cheese, A. consumer surplus decreases and pr

Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter7: Consumers, Producers, And The Efficiency Of Markets
Section7.2: Producer Surplus
Problem 2QQ
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Click on the icon to read the news clip, then answer the following questions.
The graph shows the market for milk in Venezuela when a price control is in effect.
Draw a shape that represents:
1) consumer surplus. Label it CS.
2) producer surplus. Label it PS.
3) the deadweight loss. Label it DWL.
Also draw a shape that show the resources lost from time spend in line. Label it
Loss.
Moving from a milk market with no price controls to a milk with price controls
consumer surplus and
producer surplus.
OA. increases; increases
OB. increases; decreases
OC. decreases; increases
OD. decreases; decreases
In the market for cheese,
OA. consumer surplus decreases and producer surplus decreases
60-
50-
40-
30
20-
10-
Price (bolivars per gallon)
0
40
$
300
200 300 400 500 600 700
Quantity (gallons of milk)
>>> Draw only the objects specified in the question.
100
Price
control
D
Next
SOU
Transcribed Image Text:Click on the icon to read the news clip, then answer the following questions. The graph shows the market for milk in Venezuela when a price control is in effect. Draw a shape that represents: 1) consumer surplus. Label it CS. 2) producer surplus. Label it PS. 3) the deadweight loss. Label it DWL. Also draw a shape that show the resources lost from time spend in line. Label it Loss. Moving from a milk market with no price controls to a milk with price controls consumer surplus and producer surplus. OA. increases; increases OB. increases; decreases OC. decreases; increases OD. decreases; decreases In the market for cheese, OA. consumer surplus decreases and producer surplus decreases 60- 50- 40- 30 20- 10- Price (bolivars per gallon) 0 40 $ 300 200 300 400 500 600 700 Quantity (gallons of milk) >>> Draw only the objects specified in the question. 100 Price control D Next SOU
Click on the icon to read the news clip, then answer the following questions.
...
1/47 Suvungin NL.
Also draw a shape that show the resources lost from time spend in line. Label it
Loss.
Moving from a milk market with no price controls to a milk with price controls
consumer surplus and
producer surplus.
OA. increases; increases
B. increases; decreases
OC. decreases; increases
OD. decreases; decreases
In the market for cheese,
OA. consumer surplus decreases and producer surplus decreases
B. total surplus is maximized and no deadweight loss arises
OC. the price is below the market equilibrium
OD. a deadweight loss arises
Transcribed Image Text:Click on the icon to read the news clip, then answer the following questions. ... 1/47 Suvungin NL. Also draw a shape that show the resources lost from time spend in line. Label it Loss. Moving from a milk market with no price controls to a milk with price controls consumer surplus and producer surplus. OA. increases; increases B. increases; decreases OC. decreases; increases OD. decreases; decreases In the market for cheese, OA. consumer surplus decreases and producer surplus decreases B. total surplus is maximized and no deadweight loss arises OC. the price is below the market equilibrium OD. a deadweight loss arises
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