A fall in the market price will increase consumer surplus.
Fall in market price are caused by excessive supply of product into the market.
- In other word, an increase in supply decreases the price and thus increases the quantity availability in the market.
- When quantity supply increases and equilibrium price decreases, there is an increases of consumer surplus as the consumer reservation price is same.
- Let understand that "consumer surplus" occurs when the price paid for a product is less than the price they plan to pay for initially.
In conclusion, there will be an increased consumer surplus as a result of the fall in market price caused by change in supply.
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