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

Cross elasticity of demand — practice question

The diagram illustrates the smartphones market in India. As incomes in India have increased, demand for this normal good has moved from D1 to D2. Which shaded area now shows consumer surplus, and which shaded area now shows producer surplus?

  • Aconsumer surplus: FMH; producer surplus: HMK
  • Bconsumer surplus: FMH; producer surplus: OKMT
  • Cconsumer surplus: GNJ; producer surplus: HMNJ
  • Dconsumer surplus: GNJ; producer surplus: JNK

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