Question

Suppose the United States removes sugar quotas and the market price of sugar drops. If the demand curve for candy bars is downward-sloping, in the candy bar market we would expect the:________

a. Consumer surplus to decrease.


b. Deadweight loss to increase.


c. Consumer surplus to increase.


d. Consumer surplus to be unchanged

Answer 1

C. Consumer surplus to increase

Step-by-step explanation:

Sugar is a cost of production. With the cost being lower, costs of production for candy bars are lower. Supply shifts right, extra CS.