Sarah and David both have linear demand curves for lemonade. Sarah's demand curve for lemonade intersects David's demand curve at a price of 50 cents per glass. Sarah's demand curve is more inelastic than David's. A change in the price of lemonade from 50 cents to 25 cents per glass will
A) decrease Sarah's consumer surplus more than David's.
B) decrease David's consumer surplus more than Sarah's.
C) increase Sarah's consumer surplus more than David's.
D) increase David's consumer surplus more than Sarah's.
D
You might also like to view...
Answer the next question based on the following supply and demand schedules in units per week for a product.PriceQuantity DemandedQuantity Supplied$601004005014034040180280302202202026016010300100If demand increased by 100 units at each price level, and the government set a price ceiling of $40, then there will be
A. a surplus. B. no shortage or surplus. C. decrease in supply. D. a shortage.
A wave of bank failures in the United States
A) occurred in the 1970s. B) occurred from the early 1980s to the early 1990s. C) occurred from late 1980s to the mid 1990s. D) has been ongoing since the late 1980s.
The wages of house painters will tend to rise when
a. more people recognize that house painters have very low incomes. b. the alternative earning opportunities of house painters improve. c. house painters can no longer find good paying alternatives for their labor. d. unemployment in the economy is high and there are few alternative jobs available for house painters.
What is a situation that makes the market behave inefficiently?
What will be an ideal response?