-The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk ________ and the consumer surplus ________.
A) increases; increases
B) increases; decreases
C) decreases; increases
D) decreases; decreases

Question

-The figure above shows the market for milk. If a drought lowers the productivity of dairy cows so that they give less milk, then the efficient quantity of milk ________ and the consumer surplus ________.
A) increases; increases 
B) increases; decreases 
C) decreases; increases 
D) decreases; decreases

Quizplus · Accepted Answer

A drought reducing milk productivity decreases the supply of milk, leading to a higher price and lower quantity. This results in a decrease in consumer surplus as consumers pay more for less milk.

-The Figure Above Shows the Market for Milk