Asked by Ashley Friend on Jul 23, 2024
Verified
Which situation would most likely cause a DECREASE in consumer surplus in the toy market?
A) The cost of shipping increases because of higher oil prices.
B) Consumer income increases.
C) There is an unexpected baby boom.
D) A new assembly line design increases worker productivity.
Consumer Surplus
The discrepancy in the total amount anticipated to be paid by consumers and the amount that is actually paid for a product or service.
Shipping Increases
A rise in the cost or amount required to transport goods from one location to another, potentially affecting trade and sales prices.
- Assess the effect of market fluctuations on consumer surplus.
Verified Answer
SM
Santiago Mendoza FarietaJul 27, 2024
Final Answer :
A
Explanation :
An increase in shipping costs would increase the overall price of toys, leading to a decrease in consumer surplus as consumers would be willing to pay less for the higher priced toys.
Learning Objectives
- Assess the effect of market fluctuations on consumer surplus.
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