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5. Consumer and Producer Surplus; Price Ceilings and Price Floors
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5. Consumer and Producer Surplus; Price Ceilings and Price Floors
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5. Consumer and Producer Surplus; Price Ceilings and Price Floors / Economic Surplus and Efficiency / Problem 9
Problem 9
If a government imposes a price floor above equilibrium, what happens to economic surplus?
A
Economic surplus is eliminated.
B
Economic surplus increases due to decreased deadweight loss.
C
Economic surplus remains unchanged.
D
Economic surplus decreases due to increased deadweight loss.
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