The diagram below shows supply,demand,and quantity exchanged of Monday matinee movie tickets.Assume it is a perfectly competitive market. FIGURE 12-4
-Refer to Figure 12-4.What is the value of the consumer surplus generated in this market at the allocatively efficient level of output?
A)$0
B)$5
C)$10
D)$125
E)$250

Question

The diagram below shows supply,demand,and quantity exchanged of Monday matinee movie tickets.Assume it is a perfectly competitive market.  FIGURE 12-4
-Refer to Figure 12-4.What is the value of the consumer surplus generated in this market at the allocatively efficient level of output?
A)$0 
B)$5 
C)$10 
D)$125 
E)$250

Quizplus · Accepted Answer

The allocatively efficient level of output is where the demand curve intersects the supply curve. At this point, the consumer surplus is the area between the demand curve and the price level up to the quantity produced. The value of $125 represents this area, calculated as the area of the triangle formed by the demand curve, the price level, and the quantity axis.

The Diagram Below Shows Supply,demand,and Quantity Exchanged of Monday Matinee