Along a straight-line downward-sloping demand curve,a decrease in the market price of a good:
A)will cause no change in consumer surplus.
B)will increase consumer surplus.
C)will decrease consumer surplus.
D)may either decrease or increase consumer surplus.

Question

Quizplus · Accepted Answer

Along a straight-line downward-sloping demand curve, a decrease in market price of a good increases consumer surplus. This is because buyers who were willing to pay the higher initial price get to buy the good at a lower price, which results in greater consumer surplus. Only choice B acknowledges this fact.

Along a Straight-Line Downward-Sloping Demand Curve,a Decrease in the Market