Ceteris paribus, a decrease in the price of a good will cause the
A) quantity demanded of the good to decrease.
B) quantity supplied of the good to increase.
C) producer surplus derived from the good to decrease.
D) supply of the good to decrease.

Question

Quizplus · Accepted Answer

A decrease in the price of a good reduces the producer surplus because producers receive less revenue for each unit sold, assuming costs remain constant.

Ceteris Paribus, a Decrease in the Price of a Good