Figure 9.2.1 -Refer to Figure 9.2.1 above. When the minimum imposed price is P₂, A) the quantity supplied is Q₂ and the quantity demanded is Q_3, so a surplus develops. B) the quantity supplied is Q₃, which results in a deadweight loss. C) the quantity supplied remains at Q₀, so only quantity demanded falls to Q₃. D) the resulting surplus in the market is transferred to consumers.

Question

Quizplus · Accepted Answer

When the minimum price is set above the equilibrium price, it creates a situation where the quantity supplied exceeds the quantity demanded, resulting in a deadweight loss. In this case, the quantity supplied would be Q₃, which is greater than the quantity demanded at Q₂, leading to a deadweight loss.

Figure 9.2.1 -Refer to Figure 9.2.1 Above. When the Minimum Imposed Price