Multiple Choice
The following diagram shows Ken's demand curve for neckties. When the price of neckties is $5, Ken purchases four neckties. When the price of neckties falls to $4, he purchases five neckties. A decline in the price of neckties causes his expenditure to:
Figure 6.3
A) increase from $20 to $25, increasing his consumer surplus.
B) increase from $20 to $25, decreasing his consumer surplus.
C) remain constant at $20, leaving his consumer surplus unchanged.
D) remain constant at $20, increasing his consumer surplus.
E) decrease from $20 to $15, increasing his consumer surplus.
Correct Answer:

Verified
Correct Answer:
Verified
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