The Number of "Gore in 2004" Buttons Demanded on a Certain

question 8

Multiple Choice

The number of "Gore in 2004" buttons demanded on a certain university campus is given by D(p) = 100 - p, where p is the price of buttons measured in pennies. The supply function is S(p) = p. The current administration manages to enforce a price ceiling of 40A2 per button. The effect on net consumer's surplus is

• A) an increase of $5.50.
• B) an increase of $3.50.
• C) no change.
• D) a decrease of $3.50.
• E) a decrease of $5.50.

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