Consider the following statements when answering this question:

I.

Consumer surplus is the difference between the amount paid and the marginal cost of producing another unit.

II

A deadweight loss is a net loss of total surplus as a result of under or over production.

Select one:

a. I is true, and II is false.

b. I and II are true.

c. I and II are false.

d. I is false, and II is true.

Deadweight loss refers to:

Select one:

a. net losses in total surplus.

b. losses in consumer surplus associated with excess government regulations.

c. situations where market prices fail to capture all of the costs and benefits of a policy.

d. losses due to the policies of labor unions.

If the government establishes a maximum price of $20, the resulting deadweight loss will be:

Select one:

a. $600.

b. $0.

c. $20.

d. $30.

e. $300.

If the market is in equilibrium, the consumer surplus earned by the buyer of the 10th unit is:

Select one:

a. $22.50.

b. $30.00.

c. $5.00.

d. $15.00.