Moving production from a high-cost producer to a low-cost producer will
A)lower total surplus.
B)raise total surplus.
C)lower producer surplus.
D)raise producer surplus but lower consumer surplus.

Question

Quizplus · Accepted Answer

Moving production from a high-cost producer to a low-cost producer will lower the cost of production, which will lead to lower prices for consumers and higher profits for producers. This will increase total surplus.

Moving Production from a High-Cost Producer to a Low-Cost Producer