Why can\'t consumer surplus ever be negative? The formula for consumer surplus c

Question

Why can't consumer surplus ever be negative?

The formula for consumer surplus contains the absolute value function.

Consumers will not trade if the price is above their willingness to pay.

Any negative consumer surplus must be channeled into producer surplus instead.

Consumer surplus is always positive, because every consumer’s willingness to pay is positive.

The formula for consumer surplus contains the absolute value function.

Consumers will not trade if the price is above their willingness to pay.

Any negative consumer surplus must be channeled into producer surplus instead.

Consumer surplus is always positive, because every consumer’s willingness to pay is positive.

Explanation / Answer

Consumer surplus is difference between the maximum price consumer wants to pay and actually he pays, thus when price is greater than the price which a consumer wants to pay. In such situation he will not buy any amount. Hence , consumer surplus can not be negative.

Correct option is " Cossumer will not trade if the price is above their willingness to pay"

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