Assume the Market Depicted in the Graph Is in Equilibrium

question 49

Multiple Choice

Assume the market depicted in the graph is in equilibrium at demand (D) and supply (S₁) . If the supply curve shifts to S₂, and a new equilibrium is reached, which of the following is true?

• A) Consumer surplus increases and total surplus increases.
• B) Consumer surplus decreases and total surplus increases.
• C) Consumer surplus increases and total surplus decreases.
• D) Consumer surplus decreases and total surplus decreases.

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