Chapter 4 Questions:\ Use the following graph to answer questions 6-8.\ 6. If the market price is

$7

, then what is consumer surplus?\ 7. If the market price is reduced from

$7

to

$5

, then what is the consumer surplus?\ 8. If the market price is reduced from

$7

to

$5

, what is the gain in consumer surplus?\ 9. True or false and why?\ a. A change in the price of bicycles will lead to a shift of the demand curve for bicycles. TF\ b. A change in the price of automobiles will lead to a shift of the demand curve for motorcycles. We call this shift a change in demand. TF\ c. A change in demand is equivalent to a movement along a given demand curve. TF\ d. When price of a good decreases, the quantity demanded increases. TF

Use the following graph to answer questions 6-8. 6. If the market price is $7, then what is consumer surplus? 7. If the market price is reduced from $7 to $5, then what is the consumer surplus? 8. If the market price is reduced from $7 to $5, what is the gain in consumer surplus? 9. True or false and why? a. A change in the price of bicycles will lead to a shift of the demand curve for bicycles. TF b. A change in the price of automobiles will lead to a shift of the demand curve for motorcycles. We call this shift a change in demand. TF c. A change in demand is equivalent to a movement along a given demand curve. TF d. When price of a good decreases, the quantity demanded increases. TF