Suppose a New Law Makes Illegal the Sale of a Good

question 17

Multiple Choice

Suppose a new law makes illegal the sale of a good that had been legal. This will

• A)decrease consumer surplus.
• B)increase consumer surplus.
• C)increase producer surplus.
• D)eliminate deadweight loss.

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Definitions:

Percentage

A proportion or share in relation to a whole, expressed as a fraction of 100.

Innovation

The process of creating new ideas, products, or methods, including the improvement of existing ones, to meet new requirements or market needs.

Product Innovation

The development of new or significantly improved goods or services to meet consumer needs or open new markets.

Process Innovation

Improvements in the methods or processes of producing goods or providing services to increase efficiency and reduce costs.