Use the Following to Answer Question

question 16

Multiple Choice

Use the following to answer question:
-(Figure: The Gains from Trade) Look at the figure The Gains from Trade.What is the total surplus in this market when the demand curve is D₂ and the market is in equilibrium?

• A)$31.25
• B)$45.00
• C)$62.50
• D)$90.00

---

Definitions:

Soft Rationing

Internal limitations set by a company on the amount of funds allocated for new investments or projects.

Operating Leverage

A measure of how revenue growth translates into growth in operating income, demonstrating the proportion of fixed versus variable costs a company has.

Fixed Costs

Expenses that remain constant regardless of how much is produced or sold, including rent, salaries, and insurance costs.

Accounting Break-Even

The point where total sales equal total expenses, and the company makes no profit but also incurs no loss.