Assume the Market Is in Equilibrium in the Graph Shown

question 33

Multiple Choice

Assume the market is in equilibrium in the graph shown 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, but producer surplus decreases.
• B) Consumer surplus decreases, but producer surplus increases.
• C) Both consumer and producer surplus increase.
• D) Both consumer and producer surplus decrease.

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Definitions:

Abandoned

Describes a place, object, or project left unused or not maintained by the people responsible for it.

Shredded

Torn or cut into thin pieces typically to prepare or dispose of materials and can also refer to food processing.

Surfacing

The process of appearing or becoming visible, often used in the context of objects coming to the surface of water or information becoming known.

Public Roads

Roads maintained by the government and accessible to the public for transportation purposes, including highways, city streets, and bridges.