The market for Good $X$ is shown here.

Which of the following represents the surplus that would result in this market at a price of $P_{3}$ ?

Choose 1 answer:
(A) $Q_{A}-Q_{B}$
(B) $Q_{C}-Q_{A}$
(C) $P_{3}-P_{5}$
(D) $Q_{B}-Q_{C}$
(C) $X-Q_{C}$

Question

The market for Good $X$ is shown here.

Which of the following represents the surplus that would result in this market at a price of $P_{3}$ ?

Choose 1 answer:
(A) $Q_{A}-Q_{B}$
(B) $Q_{C}-Q_{A}$
(C) $P_{3}-P_{5}$
(D) $Q_{B}-Q_{C}$
(C) $X-Q_{C}$

Accepted Answer

∻Solution by Steps∻ ‖ step 1 ⋮ Identify the surplus at price $P_3$: Surplus occurs when the quantity supplied exceeds the quantity demanded. At price $P_3$, the surplus is the difference between the quantity supplied at $P_3$ and the quantity demanded at $P_3$. ‖ ‖ step 2 ⋮ Locate the quantity supplied at $P_3$: Follow the vertical line from $P_3$ to the supply curve (S) to find the corresponding quantity, which is $Q_B$. ‖ ‖ step 3 ⋮ Locate the quantity demanded at $P_3$: Follow the vertical line from $P_3$ to the demand curve (D) to find the corresponding quantity, which is $Q_A$. ‖ ‖ step 4 ⋮ Calculate the surplus: The surplus at price $P_3$ is the quantity supplied ($Q_B$) minus the quantity demanded ($Q_A$), which is $Q_B - Q_A$. ‖ ∻Answer∻ ***A*** ∻Key Concept∻ ⚹Surplus Calculation⚹ ∻Explanation∻ ⚹Surplus in a market is calculated as the quantity supplied minus the quantity demanded at a given price level. It represents the excess of goods available over the quantity that consumers are willing to buy at that price.◊What is the formula for calculating consumer surplus in a market?⍭ Generate me a similar question◊⚹

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