If there is an increase in demand (parallel shift of demand to the right),assuming a positively sloped supply curve and a negatively sloped demand curve,total surplus:
A)will increase.
B)will decrease.
C)will remain the same.
D)may change,but we can't tell how.

Question

Quizplus · Accepted Answer

When there is an increase in demand, producers can charge a higher price, resulting in a higher level of production, which increases the total surplus. Hence, the answer is A.

If There Is an Increase in Demand (Parallel Shift of Demand