Use the Following to Answer Questions

question 36

Multiple Choice

Use the following to answer questions
Figure: Determining Surplus and Loss
-(Figure: Determining Surplus and Loss) Consider the graph.If the price is lowered from $8 to $5:

• A) $60 is transferred from producers to consumers.
• B) $60 is transferred from consumers to producers.
• C) $140 is transferred from producers to consumers.
• D) $140 is transferred from consumers to producers.

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Definitions:

Units-of-production

A depreciation technique that distributes an asset's expense over its lifespan according to the quantity of units manufactured.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against a fixed asset since it was put into use.

Residual Value

The estimated value that an asset will have at the end of its useful life.

Double-declining-balance

A method of accelerated depreciation calculating a larger depreciation charge in the first year of an asset's life and progressively smaller charges in subsequent years.