If You Are Willing to Purchase a House for $300,000

question 32

Multiple Choice

If you are willing to purchase a house for $300,000 and you purchase the house for $275,000,this transaction will generate:​

• A)​There is no surplus created
• B)$25,000 worth of seller surplus and unknown amount of buyer surplus
• C)$10,000 worth of buyer surplus and $15,000 of seller surplus
• D)$25,000 worth of buyer surplus and unknown amount of seller surplus

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Definitions:

Fiscal Deficits

Happens when the expenses of a government surpass its income, not counting funds acquired through borrowing.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision to pursue a certain action.

Trade Agreements Act

Legislation aimed at fostering fair and open international trade by implementing tariff concessions and other trade-related provisions.

Dumping

The practice of exporting goods at a price lower than their normal value, often with the intention of undermining local markets or competitors.