Consider the Hypothetical Supply and Demand of Kidneys

question 3

Multiple Choice

Consider the hypothetical supply and demand of Kidneys. Initially, kidneys are exchanged by donations only (price=0) . If the government decides to legalize kidney sales and the market reaches equilibrium, then:

• A) total surplus increases.
• B) consumer surplus remains the same.
• C) producer surplus remains the same.
• D) a shortage of kidneys will arise.

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