Consumer and Producer Surplus Quiz by Shubhrata Shrestha | May 24, 2025 | 0 comments Consumer and Producer Surplus Quiz 1. What does consumer surplus represent? A. Government subsidies to consumers B. Extra revenue earned by producers C. The difference between what consumers are willing to pay and what they actually pay D. A loss incurred due to taxation None 2. If demand is perfectly inelastic, a price increase will: A. Greatly reduce consumer surplus B. Have no impact on producer surplus C. Cause quantity demanded to drop significantly D. Leave quantity demanded unchanged None 3. Which of the following would likely decrease producer surplus? A. A government subsidy B. A shift of the supply curve to the left C. A rise in market price D. A new export market None 4. The area below the demand curve and above the price line is: A. Producer surplus B. Deadweight loss C. Total cost D. Consumer surplus None 5. Price elasticity of supply refers to: A. How fast consumers change quantity demanded B. How price affects utility C. The responsiveness of quantity supplied to a change in price D. Changes in government pricing policies None 6. What happens to total surplus when a tax is imposed on a good? A. It increases B. It stays the same C. It decreases D. It becomes zero None 7. Which condition is most likely to maximize both consumer and producer surplus? A. Government-imposed price ceiling B. Market equilibrium under free competition C. Fixed pricing for all products D. A monopoly pricing strategy None 8. When the supply is elastic and demand is inelastic, who bears more of the tax burden? A. The government B. Consumers C. Producers D. Both equally None 9. Which factor does not directly affect consumer or producer surplus? A. Price level B. Quantity of goods C. Consumer income D. Taste and preferences None 10. If the market price of a product increases and supply is inelastic, what happens to producer surplus? A. It decreases B. It remains unchanged C. It increases D. It depends on consumer surplus None Time's up Submit a Comment Cancel replyYour email address will not be published. Required fields are marked *Comment * Name * Email * Website Save my name, email, and website in this browser for the next time I comment. Δ
