Exhibit 6-19 -In Exhibit 6-19,when the Price Drops from $10 to $6,the

question 79

Multiple Choice

Exhibit 6-19

-In Exhibit 6-19,when the price drops from $10 to $6,the consumer surplus:

• A) Decreases from $252 to $147
• B) Increases from $45 to $147
• C) Decreases by $100
• D) Increases by $100
• E) Increases from $252 to $375

---

Definitions:

Accounting Profits

The net earnings of a company as calculated by subtracting total expenses from total revenues, according to standard accounting practices.

Perfect Competitor

A theoretical market structure where many firms sell homogeneous products, entry and exit from the market are free, and all participants have perfect information.

Perfectly Elastic

Perfectly elastic describes a situation where the quantity demanded or supplied changes by an infinite amount in response to any change in price, represented graphically as a horizontal line.

Demand Curve

A graph showing the relationship between the price of a good and the quantity demanded.