Figure 9.1.3
-Refer to Figure 9.1.3 above. If the government establishes a price ceiling of $1.00, consumer surplus will
A) fall by $50.
B) fall by $150.
C) remain the same.
D) rise by $50.
E) rise by $150.

Question

Figure 9.1.3
-Refer to Figure 9.1.3 above. If the government establishes a price ceiling of $1.00, consumer surplus will
A) fall by $50. 
B) fall by $150. 
C) remain the same. 
D) rise by $50. 
E) rise by $150.

Quizplus · Accepted Answer

A price ceiling set below the equilibrium price increases consumer surplus because consumers pay less for the product, leading to a gain in consumer surplus.

Figure 9.1.3 -Refer to Figure 9.1.3 Above. If the Government Establishes a Establishes