If the Demand Curve Reflects Consumers' Full Willingness to Pay

question 54

Multiple Choice

If the demand curve reflects consumers' full willingness to pay, and the supply curve reflects all costs of production, then which of the following is true?

• A)The benefit surpluses shared between consumers and producers will be maximized.
• B)The benefit surpluses received by consumers and producers will be equal.
• C)There will be no consumer or producer surplus.
• D)Consumer surplus will be maximized, and producer surplus will be minimized.

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Definitions:

Birthrates

The number of live births per thousand people in a population per year.

Death Rates

The number of deaths in a particular population, scaled to the size of that population, per unit of time.

Per Capita

A statistical measure that divides a total figure by the number of people in a population, used to give an average per person.

Water Consumption

The total volume of water used by individuals, communities, industries, or agriculture over a specified period.