Suppose Jones Sells a Good for $100 at a Yard

question 117

Multiple Choice

Suppose Jones sells a good for $100 at a yard sale. If the producer surplus from the sale is $75, Jones's cost of the good must have been:

• A) $100.
• B) $175.
• C) $25.
• D) equal to the deadweight loss.

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Definitions:

Rate of Increase

The speed at which a particular variable, such as price, cost, or quantity, grows over a specified period of time, typically expressed as a percentage.

Investment

Positioning funds with the foresight of generating earnings or profits.

Years

A unit of time used to measure duration, typically used to denote experience or age.

Trust Fund

A legal arrangement through which assets are held by a trustee for the benefit of another party, often used for estate planning or to manage wealth.