All else equal, the higher the price, the________ the consumer surplus and the _________ the producer surplus.

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between the price a consumer is willing to pay and the actual price they pay. As the price increases, consumer surplus decreases because consumers are less willing to pay that price. 
Producer surplus is the difference between the price a producer is willing to sell a good for and the actual price they receive. As the price increases, producer surplus increases because producers are willing to sell their goods for higher prices. Therefore, the correct answer is D: lower; higher.

All Else Equal, the Higher the Price, The________ the Consumer