Figure 3-6

-Refer to Figure 3-6.The figure above represents the market for canvas tote bags.Compare the conditions in the market when the price is $50 and when the price is $35.Which of the following describes how the market differs at these prices?
A)At each price there is a surplus; the surplus is greater at $35 than at $50.
B)The difference between quantity supplied and quantity demanded is greater at $50 than at $35.
C)At each price there is a surplus; firms will lower the equilibrium price in order to eliminate the surplus.
D)At each price the supply of tote bags exceeds that demand for tote bags.

Question

Figure 3-6
 
-Refer to Figure 3-6.The figure above represents the market for canvas tote bags.Compare the conditions in the market when the price is $50 and when the price is $35.Which of the following describes how the market differs at these prices?
A)At each price there is a surplus; the surplus is greater at $35 than at $50. 
B)The difference between quantity supplied and quantity demanded is greater at $50 than at $35. 
C)At each price there is a surplus; firms will lower the equilibrium price in order to eliminate the surplus. 
D)At each price the supply of tote bags exceeds that demand for tote bags.

Quizplus · Accepted Answer

At $50, the quantity supplied exceeds the quantity demanded, creating a surplus. At $35, there is still a surplus, but it is smaller, indicating that the difference between quantity supplied and quantity demanded is smaller. Therefore, B is the best choice as it accurately describes the difference in the market between the two prices.

Figure 3-6 -Refer to Figure 3-6.The Figure Above Represents the Market for Represents