Exhibit 39-8 -Refer to Exhibit 39-8.Assume That E₁ Represents the Initial Equilibrium

Multiple Choice

Exhibit 39-8
-Refer to Exhibit 39-8.Assume that E₁ represents the initial equilibrium in the market for grain X.If all the farmers agree to restrict production and abide by the agreement,

A) the price of X increases.
B) the equilibrium quantity decreases.
C) total revenues increase if the demand curve is inelastic between E₁ and E₃.
D) all of the above
E) a and b only