The Indifference Curve Approach to Measuring Consumer Surplus Will Yield

question 1

Multiple Choice

The indifference curve approach to measuring consumer surplus will yield the same answer as the approach using areas under the demand curve if:

• A)the substitution effect of a price change is zero.
• B)the substitution effect of a price change is larger than the income effect.
• C)the income effect of a price change is larger than the substitution effect.
• D)the income effect of a price change is zero.