Asked by Christopher Severson on May 10, 2024

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If there is an increase in demand (parallel shift of demand to the right) ,assuming a positively sloped supply curve and a negatively sloped demand curve,total surplus:

A) will increase.
B) will decrease.
C) will remain the same.
D) may change,but we can't tell how.

Total Surplus

The sum of consumer surplus and producer surplus in a market, representing the total benefits to society from the production and consumption of goods and services.

Demand

The quantity of a particular good or service that consumers are willing and able to purchase at various prices during a given period of time.

Negatively Sloped

Describes a line or curve on a graph that moves downwards as it moves from left to right, indicating an inverse relationship between two variables.

  • Develop an understanding of and analyze the association between supply, demand, and total surplus gains.
  • Interpret the impact of demand and supply shifts on total surplus.
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EF
Eseta FinauMay 12, 2024
Final Answer :
A
Explanation :
When there is an increase in demand, producers can charge a higher price, resulting in a higher level of production, which increases the total surplus. Hence, the answer is A.