Question

An increase in the selling price will cause the consumer surplus: a. decrease. b. change. C....

An increase in the selling price will cause the consumer surplus:

a. decrease.

b. change.

C. increase.

d. do not change.
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Answer #1

An increase in the selling price will cause the consumer surplus DECREASE.

Consumer surplus is the calculated area between consumers demanda curve and price line for that product sold.It is an economic measure of calculating consumer benefit.It takes place when consumer is willing to pay higher amount for a given product than the current price of the product.

By assuming no shift in consumer demand,an increase in price of the product will lead to decrease in consumer surplus.

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