In 2014, some supermarkets cut the price they were prepared to pay farmers for milk to a level below the market equilibrium price at that time. They then passed this lower price on to consumers in an attempt to draw them into the store. After that, the government introduced an effective minimum price that the supermarkets had to pay the farmers. These two moves are represented in the diagram. What would be the result after the supermarket move and then the government move?
- Aafter supermarket action: a shortage of 5000 litres; after government action: a surplus of 4000 litres
- Bafter supermarket action: a shortage of 5000 litres; after government action: a surplus of 7000 litres
- Cafter supermarket action: a shortage of 13 000 litres; after government action: a surplus of 4000 litres
- Dafter supermarket action: a shortage of 13 000 litres; after government action: a surplus of 7000 litres