Assume the Market Depicted in the Graph Is in Equilibrium

question 128

Multiple Choice

Assume the market depicted in the graph is in equilibrium. If the market goes from equilibrium to having its price set at $18:

• A) the quantity exchanged will be 9,000.
• B) all consumers will gain surplus.
• C) the deadweight loss will be $2,250.
• D) the quantity exchanged will be 4,000.

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Definitions:

Trial Balance

A bookkeeping report that lists the balances of all ledgers in two columns, debits and credits, to verify the arithmetic accuracy of the entries.

Goodwill

An intangible asset representing the excess value of a purchased company over the fair market value of its identifiable tangible and intangible assets.

Consideration Transferred

The total value of all assets, liabilities, and equity interests given to acquire control of an entity.