Figure 7-1

-Refer to Figure 7-1.Area C represents
A)the decrease in consumer surplus that results from a downward-sloping demand curve.
B)consumer surplus to new consumers who enter the market when the price falls from P₂ to P₁.
C)the increase in producer surplus when quantity sold increases from Q₂ to Q₁.
D)the decrease in consumer surplus to each consumer in the market when the price increases from P₁ to P₂.

Question

Figure 7-1
 
-Refer to Figure 7-1.Area C represents
A)the decrease in consumer surplus that results from a downward-sloping demand curve. 
B)consumer surplus to new consumers who enter the market when the price falls from P₂ to P₁. 
C)the increase in producer surplus when quantity sold increases from Q₂ to Q₁. 
D)the decrease in consumer surplus to each consumer in the market when the price increases from P₁ to P₂.

Quizplus · Accepted Answer

Area C represents the consumer surplus gained by new consumers who enter the market when the price decreases from P₂ to P₁, as it is the area between the demand curve and the new lower price level.

Figure 7-1 -Refer to Figure 7-1.Area C Represents