The figure above shows the market for coffee If the government ...

[jeatrice]

The figure above shows the market for coffee If the government pays the coffee producers a subsidy and production increases to 30 million pounds per day, the deadweight loss is
 
  A) zero.
  B) 7.5 million.
  C) 15 million.
  D) 10 million.

Question 2

An unregulated monopoly will
 
  A) flood the market with goods to deter entry.
  B) produce only where marginal revenue is zero.
  C) produce in the inelastic range of its demand curve.
  D) produce in the elastic range of its demand curve.

[kjohnson]

Answer to Question 1

B

Answer to Question 2

D