Region A (the purple shaded area) represents the total producer surplus when the market price is 5 represents the change in total producer surplus when the market price, while Region B (the grey shaded area) In the following table, indicate which statements are true or false based on the information provided on the previous graph. Statement True Producer surplus is larger when the price is $105 than when it is $75. O Assuming each student receives a positive surplus, Crystal will always receive less producer surplus than Edison. O In order for Hilary to earn a producer surplus of exactly $45 from selling a used smartphone, the market price needs to be S False O O

Why the last one is correct?

allocation might be both efficient and equitable, based on the Pareto principle." 3. In a competitive economy, the marginal cost of producing X is MCx = 20 +5qx. The margin cost of producing Y is MCy= 10 + 10qy. Prices are px 5, and py5. What linear relationship describes the proportion in which the goods should be produced? =

Assume that sugar-based soft drinks are produced in a market shown on the graph above. Answer the following questions based on the information given in the graph. (a) To reduce the consumption of sugary soft drinks, suppose the government imposes a $2 per-unit sales tax on soft drinks. (i) Will the price of soft drinks increase by the full amount of the sales tax? Explain. (ii) Calculate the tax revenue the government can collect from the sale of soft drinks. Show your work. (iii) Will the consumer surplus increase, decrease, or stay the same after the tax? (iv) Calculate the deadweight loss created by the tax. Show your work.   (b) Suppose that instead of imposing the per-unit sales tax, the government sets a price ceiling of $7. Identify the quantity of soft drinks that will be exchanged in the market as a result of the price ceiling. Explain.