In the Market for Medicine, If Surplus Is Transferred from Producers

question 304

Multiple Choice

In the market for medicine, if surplus is transferred from producers to consumers, from the standpoint of efficiency

• A) the current price of medicine is too high.
• B) the current quantity of medicine is too low.
• C) deadweight loss could be reduced if the current price were lower.
• D) total surplus increased because consumers paid lower prices for the existing inventory.

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Definitions:

Service Department

An organizational unit that provides support to the main production operations, often through maintenance, logistics, or administrative services.

Order Fulfillment Department

The division within a company that is responsible for processing customer orders and ensuring they are delivered to the correct address in a timely manner.

Variable Costs

Costs that change in proportion to the level of goods or services produced or sold.

Fixed Costs

Expenses that remain constant regardless of the level of production or sales activity, such as rent, salaries, and insurance premiums.