Figure 7-11

question 187

Multiple Choice

Figure 7-11. On the graph below, Q represents the quantity of the good and P represents the good's price.

-Refer to Figure 7-11.The equilibrium allocation of resources is

• A)efficient because total surplus is maximized at the equilibrium.
• B)efficient because consumer surplus is maximized at the equilibrium.
• C)inefficient because consumer surplus is larger than producer surplus at the equilibrium.
• D)inefficient because total surplus is maximized when 10 units of output are produced and sold.

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