Use the figure below to answer the following questions.
Figure 5.2.2
-Refer to Figure 5.2.2 If the price falls from P₁ to P₀,then the change in consumer surplus is

Question

Use the figure below to answer the following questions.

Figure 5.2.2
-Refer to Figure 5.2.2 If the price falls from P₁ to P₀,then the change in consumer surplus is

Quizplus · Accepted Answer

The change in consumer surplus is the sum of areas B and C, as these are the portions of the original consumer surplus (bounded by the original price P and the demand curve) that are no longer available at the lower price. Area A is not relevant to the change in consumer surplus, as it falls below the demand curve and does not represent surplus. Area D is also not relevant, as it lies above the demand curve and represents surplus that was not available even at the original price. Therefore, the correct answer is D (B + C).

Use the Figure Below to Answer the Following Questions