which statement is correctDora visits a clothing store to buy new dress suit. She is willing to pay $100 for the suit, but buys one on sale for $75. Dora's consumer surplus from the purchase is $75.If production technology improves in the shoe industry, consumer surplus for shoe buyers will increase because the rightward shift of supply caused the price to fall.Suppose that the equilibrium price in the market for heating oil is $3.50 per gallon. If a law imposed a price ceiling on the market and reduced the maximum legal price for heating oil to $3.00 per gallon then any possible decrease in producer surplus would be smaller than the gain of consumer surplus.A result of welfare economics is that the price of a product is considered to be the best price because it maximizes total surplus.A seller would be willing to sell a product only if the price received is less than the cost of production.Suppose that the equilibrium wage in the labor market is $8.00 per hour of labor. If a law increased the minimum wage from $7.25 to $10.00 per hour of labor, any possible increase in producer surplus would be smaller than the loss of consumer surplus.In a market, for any given quantity, the price on a demand curve represents the marginal buyer's willingness to pay.

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Answered: which statement is correct Dora visits…

Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781305971509

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter7: Consumers, Producers, And The Efficiency Of Markets

Section: Chapter Questions

Problem 6PA

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which statement is correct

Dora visits a clothing store to buy new dress suit. She is willing to pay $100 for the suit, but buys one on sale for $75. Dora's consumer surplus from the purchase is $75.
If production technology improves in the shoe industry, consumer surplus for shoe buyers will increase because the rightward shift of supply caused the price to fall.
Suppose that the equilibrium price in the market for heating oil is $3.50 per gallon. If a law imposed a price ceiling on the market and reduced the maximum legal price for heating oil to $3.00 per gallon then any possible decrease in producer surplus would be smaller than the gain of consumer surplus.
A result of welfare economics is that the price of a product is considered to be the best price because it maximizes total surplus.
A seller would be willing to sell a product only if the price received is less than the cost of production.
Suppose that the equilibrium wage in the labor market is $8.00 per hour of labor. If a law increased the minimum wage from $7.25 to $10.00 per hour of labor, any possible increase in producer surplus would be smaller than the loss of consumer surplus.
In a market, for any given quantity, the price on a demand curve represents the marginal buyer's willingness to pay.

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