Question

Refer to the above diagram for the milk market. If the price were $2.00 per gallon, then there would be

A.a shortage of 20 million gallons.
B.a shortage of 10 million gallons.
C.a surplus of 10 million gallons.
D.a surplus of 30 million gallons.

Answer 1

If the price is $2.00 per gallon in the milk market, the correct outcome would be a shortage of 10 million gallons.

Step-by-step explanation:

The question refers to a diagram showcasing the milk market, so it falls under the subject of Economics within the broader area of Social Studies. The grade level for this question is High School. To determine the outcome in the milk market if the price is $2.00 per gallon, we need to compare the quantity demanded and the quantity supplied. If the quantity demanded is lower than the quantity supplied, there would be a surplus. On the other hand, if the quantity demanded is higher than the quantity supplied, there would be a shortage.

• If the price is $2.00 per gallon and the quantity demanded is higher than the quantity supplied, then there would be a shortage. Therefore, option B - a shortage of 10 million gallons - is the correct answer.