Asked by Haimanti Bhattacharyya on Jul 08, 2024
Verified
Refer to Figure 7-13. Suppose demand shifts such that consumers wish to purchase 12 fewer units at every price. How much is total consumer surplus in this market at the new equilibrium price?
Consumer Surplus
The disparity in what consumers are willing to invest in a good or service compared to what they eventually invest.
Demand Shifts
Occur when external factors lead to a change in the amount of a product or service that consumers are willing and able to buy at a given price, resulting in the demand curve moving rightward or leftward.
New Equilibrium
The point at which market supply and demand balance each other, and, as a result, prices become stable following a disturbance.
- Develop an understanding of consumer surplus and master the calculation methods at market equilibrium.
- Assess the consequences of changes in the market on the excess benefits received by producers and consumers.
Verified Answer
IC
Ivania CoreasDiazJul 11, 2024
Final Answer :
Total consumer surplus at the new equilibrium price is $225.
Learning Objectives
- Develop an understanding of consumer surplus and master the calculation methods at market equilibrium.
- Assess the consequences of changes in the market on the excess benefits received by producers and consumers.