Along a given demand curve, an increase in the price of a good will:
A)increase consumer surplus.
B)decrease consumer surplus.
C)have no effect on consumer surplus.
D)decrease producer surplus.

Question

Quizplus · Accepted Answer

An increase in the price of a good will lead to a decrease in consumer surplus. This is because as the price of the good increases, consumers are willing to purchase less of it, which results in them losing out on the surplus (the difference between what they are willing to pay and what they actually pay).

Along a Given Demand Curve, an Increase in the Price