APFIVE Simultaneous Shifts and Total Economic Surplus
The market for natural gas experiences simultaneous shifts: increased environmental regulations (leftward supply shift) and growing consumer preference for cleaner energy (rightward demand shift). If total economic surplus decreases despite quantity remaining unchanged, which must be true?
A
The market reached a more allocatively efficient equilibrium
B
Consumer surplus increased more than producer surplus decreased
C
The supply shift created a larger deadweight loss than the surplus gained from the demand shift
D
The price elasticity of demand must be perfectly inelastic
Question Leaderboard
Not enough data yet to show leaderboard.