A firm's accounting profit is always equal to or greater than its economic profit

Refer to Figure 16-1. Suppose the economy is in short-run equilibrium above potential GDP and automatic stabilizers move the economy back to long-run equilibrium

Using the static AD-AS model in the figure above, this would be depicted as a movement from A) D to C. B) B to A. C) C to B. D) E to A. E) A to E.

The market demand function for ice cream is Qd = 10 - 2P and the market supply function for ice cream is Qs = 4P - 2, where both quantities are measured in millions of gallons per year. What is the consumer surplus at the competitive market equilibrium?

A. $4.5 million B. $9 million C. $13.5 million D. $18 million