The Student Room Group

A-level Economics - Consumer Surplus

I understand the effect that a change in price has on the consumer surplus but i have a 4 mark question asking to 'explain the impact of a fall in demand on consumer surplus ceteris parabus'. What would be the answer to this to gain 4 marks?
Sorry you've not had any responses about this. :frown: Are you sure you've posted in the right place? :smile: Here's a link to our subject forum which should help get you more responses if you post there. :redface:


Just quoting in Danny Dorito so she can move the thread if needed :wizard:

Spoiler

Original post by Economicshelp
I understand the effect that a change in price has on the consumer surplus but i have a 4 mark question asking to 'explain the impact of a fall in demand on consumer surplus ceteris parabus'. What would be the answer to this to gain 4 marks?


Fall in demand > movement to left of D curve > new equilibrium @ higher price and lower quantity >consumer surplus is now a smaller triangle.

note: draw a diagram for full marks usually

Quick Reply