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.Suppose a disequilibrium price of $7.50 per movie ticket is imposed in this market.The consumer surplus becomes ________ and the producer surplus becomes ________.
A)$0; $62.50
B)$2.50; $7.50
C)$62.50; $125
D)$62.50; $250
E)$31.25; $156.25

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.Suppose a disequilibrium price of $7.50 per movie ticket is imposed in this market.The consumer surplus becomes ________ and the producer surplus becomes ________.
A)$0; $62.50 
B)$2.50; $7.50 
C)$62.50; $125 
D)$62.50; $250 
E)$31.25; $156.25

Quizplus · Accepted Answer

The correct answer is E because at a disequilibrium price of $7.50, the quantity demanded is 10 tickets and the quantity supplied is 25 tickets. The consumer surplus is the area below the demand curve and above the price line, which is a triangle with a base of 10 tickets and a height of $2.50, so the consumer surplus is $12.50. The producer surplus is the area above the supply curve and below the price line, which is a triangle with a base of 15 tickets and a height of $5.00, so the producer surplus is $37.50. The total surplus is the sum of the consumer surplus and the producer surplus, which is $50.00.

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