Assume the market is in equilibrium in the graph shown at demand D and supply S1 (and a quantity of 5). If the supply curve shifts to S2, and a new equilibrium is reached (at a quantity of 7), which of the following is true?
A) Consumer surplus increases by $5.
B) Consumer surplus decreases by $5.
C) Consumer surplus increases by $9.
D) Consumer surplus decreases by $9.

Question

Assume the market is in equilibrium in the graph shown at demand D and supply S1 (and a quantity of 5). If the supply curve shifts to S2, and a new equilibrium is reached (at a quantity of 7), which of the following is true?
A) Consumer surplus increases by $5. 
B) Consumer surplus decreases by $5. 
C) Consumer surplus increases by $9. 
D) Consumer surplus decreases by $9.

Quizplus · Accepted Answer

The Answer of  Assume the market is in equilibrium in the graph shown at demand D and supply S1 (and a quantity of 5). If the supply curve shifts to S2, and a new equilibrium is reached (at a quantity of 7), which of the following is true?
A) Consumer surplus increases by $5. 
B) Consumer surplus decreases by $5. 
C) Consumer surplus increases by $9. 
D) Consumer surplus decreases by $9.

Assume the Market Is in Equilibrium in the Graph Shown