Q: Which graph illustrates the market for a nonscarce good?
Ans: The answer is option C only because both the demand and supply curves do not cross above 0 prices.
Q: Allocative efficiency occurs only at that output where?
Ans: option b- where consumer and producer surplus are equal.
Q: The following graph shows the market for apples. Assume that the government has imposed a price floor of $10 per crate.
Ans: a. how many crates of apples will be sold to consumers after the price floor has been imposed?
According to the graph, 28 million crates of apples will be sold to consumers.
b. Will there be a shortage or a surplus of apples? If there is a shortage or a surplus, how large will it is?
There will be surplus of apples and it will be the difference between 34 million- 28 million crates of apples.
c. Will apple producers benefit from the price floor? If so, explain how they will benefit.
After the price floor of $10 was imposed, producers would sell 28 million crates of apple and the earning will be 28 x 10= $280 million.
And so, the profit or benefit would be $40 million ($280 million- $240 million)