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$250. $350. $500. $600. $250. $350. $500. $600. Consumer surplus is: the differe

ID: 1099653 • Letter: #

Question

$250.

$350.

$500.

$600.

$250.

$350.

$500.

$600.

Consumer surplus is:

the difference between the market price a consumer pays for a good and its production cost.

the difference between the maximum price a consumer is willing to pay for a good and the price the consumer can afford to pay.

the difference between the maximum price a consumer is willing to pay for a good and its market price.

the difference between the minimum price a consumer is willing to pay for a good and its market price.

$250.

$350.

$500.

$600.

Explanation / Answer

Q1 ) The concumer Surplus is the area of the top left traignle in the graph = 1/2 * 100 * (12-7) = $350

Q2) (a)the difference between the market price a consumer pays for a good and its production cost.