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5. Consumer and Producer Surplus; Price Ceilings and Floors
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5. Consumer and Producer Surplus; Price Ceilings and Floors
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5. Consumer and Producer Surplus; Price Ceilings and Floors / Consumer Surplus and Willingness to Pay / Problem 1
Problem 1
If the market price decreases from \$10 to \$6, how does the consumer surplus change on a graph?
A
The consumer surplus area increases as the price line moves downward.
B
The consumer surplus area remains the same as the demand curve does not change.
C
The consumer surplus area disappears as the market reaches equilibrium.
D
The consumer surplus area decreases as the price line moves upward.
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