-Refer to the diagram above.Assume that a price ceiling is imposed at point G,i.e. ,the price is now represented by the distance 0G.The reason that consumer surplus changes when a price ceiling is imposed is that
A) more consumers have access to the good.
B) consumers from 0 to Q2 are able to purchase the good for 0G instead of 0B.
C) firms are forced to provide the good at a fair price to all consumers from 0 to Q3.
D) the value of the good to consumers rises because fewer units are available.
E) consumers can now spend more on other goods and services.

Question

-Refer to the diagram above.Assume that a price ceiling is imposed at point G,i.e. ,the price is now represented by the distance 0G.The reason that consumer surplus changes when a price ceiling is imposed is that
A) more consumers have access to the good. 
B) consumers from 0 to Q2 are able to purchase the good for 0G instead of 0B. 
C) firms are forced to provide the good at a fair price to all consumers from 0 to Q3. 
D) the value of the good to consumers rises because fewer units are available. 
E) consumers can now spend more on other goods and services.

Quizplus · Accepted Answer

When a price ceiling is imposed at point G, consumers from 0 to Q2 can purchase the good at a lower price (0G instead of 0B), increasing consumer surplus.

-Refer to the Diagram Above