3. If the price of a DVD rises to $20, the quantity bought decreases to 10 a day. Consumer surplus decreases to

(the area of the green triangle in Figure 3 ). Consumer surplus decreases by

$75 (from $100 in Figure 2 to $25 in Figure 3 ).

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$20 − $15 

($25 − $15) × 20 ÷ 2 = $100

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$15 × 20 = $300

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$300 + $100 = $400.

($25 − $20) × 10 ÷ 2 = $25

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Figure 2 Figure 3 Solution to In the News