Author Question: The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so ... (Read 42 times)

swpotter12 · **on:** Jun 29, 2018

The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk ________ and the consumer surplus ________.

A) increases; increases
B) increases; decreases
C) decreases; increases
D) decreases; decreases

Question 2

The above figure shows the market for blouses. The government decides to impose the sales tax on sellers, as shown in the figure. How much consumer surplus is lost?

A) 10,000
B) 20,000
C) 25,000
D) 40,000