Consumer Surplus Is

question 56

Multiple Choice

Consumer surplus is

• A)the difference between the maximum price consumers are willing to pay and the minimum price producers are willing to accept.
• B)the excess of the benefit received from a good over the amount paid for it.
• C)the total value to consumers of a good.
• D)equal to the area under the demand curve.
• E)the total amount paid for a good.

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Definitions:

Producer Surplus

The difference between what producers are willing to accept for a good or service and the actual price they receive.

Market Price

The market price is the current price at which an asset or service can be bought or sold in a given market.

Consumer Surplus

The difference between the total amount consumers are willing and able to pay for a good or service and the total amount they actually pay.

Willing to Pay

The maximum price at which a consumer values a good or service enough to purchase it.