Suppose that development of oil fields around the Caspian Sea leads to an increase in the world supply of gasoline. This change in the market for gasoline would lead to
a. an increase in the equilibrium price and lower consumer surplus
b. a decrease in the equilibrium price and greater consumer surplus
c. an increase in the equilibrium price and greater consumer surplus
d. a decrease in the equilibrium price and lower consumer surplus
e. no change in consumer surplus
b. a decrease in the equilibrium price and greater consumer surplus
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What happens to consumer surplus as price falls along a given demand curve?
a. It always increases. b. It always decreases. c. It never changes. d. It increases only if price increases just a little. e. It depends on the elasticity of demand and supply.
If Happy Babies sells its baby formula in the United States for 30 percent less than it does in Canada, this is an example of ________.
A) peak-load pricing B) two-part pricing C) third-degree price discrimination D) second-degree price discrimination