-Refer to the diagram above.Assume that a price ceiling is imposed at point G,i.e. ,the price is now represented by the distance 0G.Consumer surplus after the price ceiling is imposed is
A) ½(A
J)(J
E).
B) GJEF.
C) ½(A
B)(B
C)+ BHFG.
D) ½(A
J)(J
E)+ JEFG.
E) unable to be calculated.

Question

-Refer to the diagram above.Assume that a price ceiling is imposed at point G,i.e. ,the price is now represented by the distance 0G.Consumer surplus after the price ceiling is imposed is
A) ½(A
J)(J
E). 
B) GJEF. 
C) ½(A
B)(B
C)+ BHFG. 
D) ½(A
J)(J
E)+ JEFG. 
E) unable to be calculated.

Quizplus · Accepted Answer

The consumer surplus after the price ceiling is imposed is the area above the price level 0G and below the demand curve, which is represented by the area ½(AJ)(JE) (the triangle above the price ceiling) plus the area JEFG (the rectangle between the price ceiling and the demand curve).

-Refer to the Diagram Above