A Surplus of Wheat

question 19

Multiple Choice

A surplus of wheat:

• A) is impossible if people are hungry.
• B) is impossible if the price of wheat is below equilibrium.
• C) will result when the quantity demanded exceeds the quantity supplied at the current price.
• D) is unlikely to cause any change in the price of wheat.
• E) indicates that the problem of scarcity of wheat has been solved.

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Definitions:

Consumer Surplus

The difference between the total amount consumers are willing and able to pay for a good or service and the total amount they actually pay.

Willingness to Pay

The maximum amount an individual or entity is willing to pay for a good or service, reflecting its perceived value.

Marginal Utility

The additional satisfaction or benefit gained from consuming one more unit of a good or service.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service and what they actually pay, representing their gained benefit.