Use the Following to Answer Question

question 92

Multiple Choice

Use the following to answer question:
-(Figure: Consumer and Producer Surplus) Look at the figure Consumer and Producer Surplus.If the price is held below equilibrium,producer surplus will be _____ if the market were in equilibrium and total surplus will be _____ if the market were in equilibrium.

• A)less than;less than
• B)greater than;the same as
• C)less than;the same as
• D)greater than;less than

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Definitions:

Gross Profit

The distinction between sales income and the expense of goods sold prior to subtracting overhead costs, wages, taxes, and interest charges.

Periodic

Relating to or occurring at regular intervals; in accounting, it may refer to methods or adjustments made at regular intervals, such as the Periodic Inventory Method.

Inventory Method

An accounting approach used to value inventory, including procedures like First-In, First-Out (FIFO) or Last-In, First-Out (LIFO).

Perpetual

An inventory system where transactions are recorded in real-time, immediately affecting the inventory account, providing an ongoing record of inventory on hand.