Question 1:

Barring consumption externalities, a fall in the price of a commodity

1. will always increase the consumer rent, no matter how income is initially distributed.

2. will always increase both the consumer surplus and the total gross benefit to society from consuming the product.

3. will give a different measure of the consumer rent for each different distribution of income.

4. will do all of the above.

Choose the option that yields the correct answer.