Question

The current price for a good is ​$​, and units are demanded at that price. The price elasticity of demand for the good is . When the price of the good drops by percent to ​$​, consumer surplus _______ increases decreases by ​$ nothing. ​(Enter your response to the nearest​ penny.)

Answer 1

Answer:

Consumer surplus decreases by $180.

Explanation:

Current consumer surplus =  $25 * 90 unit = $2250

If the price of goods drop to $23 then the new consumer surplus will be

$23 * 90 units = $2070

The change in consumer surplus is $180 .