If a Price Ceiling of $8 Were Placed on the Market

question 150

Multiple Choice

If a price ceiling of $8 were placed on the market in the graph shown, which area represents the surplus that is transferred from producers to consumers?

• A) C + D + F + G
• B) C + D
• C) F + G
• D) C

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Definitions:

Accounts Receivable

Money owed to a business by its customers for goods or services that have been delivered but not yet paid for.

Accounts Payable

The amounts a company owes to its suppliers or creditors for goods or services received that are not yet paid for.

Cash Flow

The net amount of cash and cash-equivalents being transferred into and out of a business.

Marketable Securities

Financial instruments that can be easily converted into cash, such as stocks or bonds.