If You Are Willing to Sell Your Old Bicycle for $30

question 70

Multiple Choice

If you are willing to sell your old bicycle for $30, but someone offers you $40 for it, the results of the transaction would yield

• A) $10 worth of producer surplus and unknown consumer surplus.
• B) $10 worth of consumer surplus and unknown producer surplus.
• C) $30 worth of consumer surplus and $10 worth of producer surplus.
• D) $30 worth of producer surplus and $10 worth of consumer surplus.

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Definitions:

Antitrust Laws

Legislation enacted to prevent anti-competitive practices, promote fair competition, and protect consumers from monopolies and cartels.

Illegal

Activities or actions that are forbidden by law and subject to criminal penalties or fines.

Fixing Prices

Illegally setting the price of goods or services, rather than allowing them to be determined naturally through free-market competition.

Economic Competition

The situation in which different companies or entities vie for the same customers or market share in an industry, influencing prices, product quality, and innovation.