If the cost to download a song from the Internet falls from $0.99 to $0.50 along an upward-sloping supply curve,producer surplus in the market for MP3 players is likely to:
A)increase.
B)decrease.
C)not change.
D)We cannot determine what producer surplus will do without information about consumer surplus.

Question

Quizplus · Accepted Answer

When the price of a song decreases, the revenue that producers receive for each song also decreases, leading to a decrease in producer surplus along the supply curve.

If the Cost to Download a Song from the Internet