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

Question

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

Quizplus · Accepted Answer

An increase in the price of a good, with all other factors being equal (ceteris paribus), will decrease the consumer surplus because consumers are paying more for the same amount of the good, reducing the difference between what consumers are willing to pay and what they actually pay.

Ceteris Paribus, an Increase in the Price of a Good