If the price of oak lumber increases,what happens to consumer surplus in the market for oak cabinets
A)It increases.
B)It decreases.
C)It does not change, but producer surplus will change.
D)It will increase then decrease.

Question

Quizplus · Accepted Answer

If the price of oak lumber increases, the cost of producing oak cabinets will also increase, decreasing the supply of oak cabinets in the market. As a result, the price of oak cabinets will rise, reducing consumer surplus as buyers will have to pay higher prices for the same product. Therefore, consumer surplus will decrease.

If the Price of Oak Lumber Increases,what Happens to Consumer