If the cost of producing sofas decreases,then consumer surplus in the sofa market will
A)increase.
B)decrease.
C)remain constant.
D)increase for some buyers and decrease for other buyers.

Question

Quizplus · Accepted Answer

When the cost of producing sofas decreases, the price of sofas will decrease (assuming the market is competitive). This will create a surplus for the consumers who are willing to pay more than the new lower price. As a result, the consumer surplus in the sofa market increases.

If the Cost of Producing Sofas Decreases,then Consumer Surplus in the Sofa