Refer to the graph shown. When the price is P1, total consumer surplus is A.A B.A+B C.A+B+C D.A+B+C+D E.A+B+C+D+E This image represents a basic demand curve graph commonly used in economics to illustrate the relationship between the price of a good and the quantity demanded by consumers.### Graph Explanation:- **Axes:** - The vertical axis (Y-axis) represents the "Price" of a good or service. - The horizontal axis (X-axis) represents the "Quantity" of the good or service demanded.- **Demand Curve:** - The downward sloping line indicates the demand curve, showing that as the price decreases, the quantity demanded increases, and vice versa.- **Points and Lines:** - **$ P_1 $ and $ P_2 $:** These are specific price points on the Y-axis. - **$ Q_1 $ and $ Q_2 $:** These are specific quantity points on the X-axis.- **Areas:** - **Area A:** Represents the loss in consumer surplus when the price increases from $ P_1 $ to $ P_2 $. - **Area B + C:** Represents the original consumer surplus when the price was at $ P_1 $. - **Area D:** Represents the gained consumer surplus when the price decreases from $ P_2 $ to $ P_1 $. - **Area E:** Represents the loss in quantity demanded from $ Q_1 $ to $ Q_2 $ when the price increases to $ P_2 $.The graph visually demonstrates how changes in price can affect consumer behavior and the resulting consumer surplus.

Consumer surplus refers to the difference between the total amount a consumer willing to pay and the…

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Refer to the graph shown. When the price is P1, total consumer surplus is A. A B. A+B C. A+B+C D. A+B+C+D E. A+B+C+D+E

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

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Chapter1: Making Economics Decisions

Section: Chapter Questions

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Question

Refer to the graph shown. When the price is P1, total consumer surplus is

	A.	A
	B.	A+B
	C.	A+B+C
	D.	A+B+C+D
	E.	A+B+C+D+E

This image represents a basic demand curve graph commonly used in economics to illustrate the relationship between the price of a good and the quantity demanded by consumers.

### Graph Explanation:

- **Axes:**
- The vertical axis (Y-axis) represents the "Price" of a good or service.
- The horizontal axis (X-axis) represents the "Quantity" of the good or service demanded.

- **Demand Curve:**
- The downward sloping line indicates the demand curve, showing that as the price decreases, the quantity demanded increases, and vice versa.

- **Points and Lines:**
- **$ P_1 $ and $ P_2 $:** These are specific price points on the Y-axis.
- **$ Q_1 $ and $ Q_2 $:** These are specific quantity points on the X-axis.

- **Areas:**
- **Area A:** Represents the loss in consumer surplus when the price increases from $ P_1 $ to $ P_2 $.
- **Area B + C:** Represents the original consumer surplus when the price was at $ P_1 $.
- **Area D:** Represents the gained consumer surplus when the price decreases from $ P_2 $ to $ P_1 $.
- **Area E:** Represents the loss in quantity demanded from $ Q_1 $ to $ Q_2 $ when the price increases to $ P_2 $.

The graph visually demonstrates how changes in price can affect consumer behavior and the resulting consumer surplus.

Consumer’s gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price and up to the equilibrium quantity. Consumer surplus is represented by area A.

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