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

Cross elasticity of demand — practice question

D1 and S1 show the original demand and supply curves for a product. D2 and S2 indicate the corresponding curves after market conditions change. What are the resulting changes in consumer and producer surplus?

  • Achange in consumer surplus: from R to P; change in producer surplus: from U to Q
  • Bchange in consumer surplus: from R + T to P; change in producer surplus: from U to Q + R
  • Cchange in consumer surplus: from R + T to P; change in producer surplus: from V to Q
  • Dchange in consumer surplus: from R to P + S; change in producer surplus: from V to Q + R

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