Economics 9708 · AS & A Level · Cross elasticity of demand

Cross elasticity of demand — practice question

In the diagram, the supply of a product rises while the demand curve stays fixed. Which row correctly shows the effect on consumer surplus and producer surplus?

  • Aconsumer surplus has fallen; producer surplus has fallen
  • Bconsumer surplus has fallen; producer surplus has risen
  • Cconsumer surplus has risen; producer surplus has fallen
  • Dconsumer surplus has risen; producer surplus has risen

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