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Ivenika [448]
3 years ago
10

Consider the market demand and supply for eggs. Assume that the market for eggs is perfectly competitive. Suppose that egg produ

cers organize themselves and establish a system of quotas. Each​ farmer's output is restricted by a specified amount of egg that he can produce.

Business
1 answer:
In-s [12.5K]3 years ago
3 0

Answer:

The quota system is not efficient since the total supply is less than the equilibrium quantity. This will produce a deadweight loss which equals the lost supplier surplus plus the lost consumer surplus. The deadweight loss s the area between the demand and supply curve, and between the imposed quota and the equilibrium quantity.

Graph 1 shows the market equilibrium while graph 2 shows the deadweight loss.

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Answer:

d. a and b

Explanation:

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Correct answer

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