If the government establishes a price floor of $40 and government purchases the surplus over quantity...

 

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If the government establishes a price floor of $40 and government purchases the surplus over quantity demanded, producer surplus will Figure 2.4 $ $80 $70 $60 $ 50 $40 $30 $ 20 $ 10 10 20 30 40 50 60 70 80 90 O rise by $500. O fall by $275. O fall by $500. Orise by $275. S O remain the same. Q(Widgets) If the government establishes a price floor of $40 and government purchases the surplus over quantity demanded, producer surplus will Figure 2.4 $ $80 $70 $60 $ 50 $40 $30 $ 20 $ 10 10 20 30 40 50 60 70 80 90 O rise by $500. O fall by $275. O fall by $500. Orise by $275. S O remain the same. Q(Widgets)

Answer rating: 100% (QA)

Solution Option a is the correct Explanation ANSWER Rise by ... View the full answer