Binding price floor reduces consumer surplus and boosts producer surplus Steps:

• Identify equilibrium: Original supply-demand intersection sets price P and quantity Q.
• Apply price floor: Set minimum price above P, reducing quantity to Q' where supply equals demand at floor price.
• Calculate consumer surplus change: CS loss is rectangle s (higher price on Q' units) plus triangle (lost surplus on Q'-Q units).
• Calculate producer surplus change: PS gain is rectangle t (higher price on Q' units) minus triangle u (lost surplus on Q'-Q units), netting t-u.

Why D is correct:

• Matches standard surplus formula: CS falls by area s (tax/price burden on consumers); PS rises by t-u (price gain exceeds quantity loss per economic rent definition).

Why the others are wrong:

• A: Miscalculates PS as full t gain, ignoring u loss from reduced sales.
• B: Wrong CS loss (t instead of s) and invents u-v without graph basis.
• C: Overstates CS loss by adding v and uses undefined w for PS.

Final answer: D