Suppose There Is an Early Freeze in California That Reduces

question 78

Multiple Choice

Suppose there is an early freeze in California that reduces the size of the lemon crop.What happens to consumer surplus in the market for lemons?

• A)Consumer surplus increases.
• B)Consumer surplus decreases.
• C)Consumer surplus is not affected by this change in market forces.
• D)We would have to know whether the demand for lemons is elastic or inelastic to make this determination.

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Definitions:

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A technique in statistics for using multiple independent factors to predict the behavior of a response variable.

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A numerical or constant quantity placed before and multiplying the variable in an algebraic expression (e.g., in linear models, indicating the magnitude and direction of the relationship).

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A statistical technique used to predict the outcome of a dependent variable based on several independent variables.