Consumer surplus is the difference between what the consumers want and what they
ID: 2429140 • Letter: C
Question
Consumer surplus is the difference between
what the consumers want and what they get.
the prices that consumers would have been willing to pay and the prices that consumers actually pay.
the prices that producers would have been willing to charge and what they actually charge.
d) market prices and prices resulting from government regulation.
a)what the consumers want and what they get.
b)the prices that consumers would have been willing to pay and the prices that consumers actually pay.
c)the prices that producers would have been willing to charge and what they actually charge.
d) market prices and prices resulting from government regulation.
Explanation / Answer
Option b)
Market demand curve shows the willingness to pay for the consumers in the market for every unit of good.
But market always fix a price that has to be charged from them for every unit,( the same price),
Thus consumer surplus occurs for those customers who have higher willingness to pay for the commodity , but they happen to pay less than that., Thus in some sense they are benefitted.
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