Consumer Surplus Is the Area on the Graph

question 169

Multiple Choice

Consumer surplus is the area on the graph

• A) above the supply curve and below the demand curve.
• B) below the demand curve and above the market price.
• C) that represents the gains that producers receive when they sell a product.
• D) that reflect the opportunity cost of producing the a good.

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Definitions:

Required Rate

The minimum return an investor expects to achieve by investing in a particular asset, also known as the required rate of return.

Expected Rate

The return that an investor anticipates or estimates will be achieved over a certain period on an investment.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices during a given time period.

Equilibrium

Equilibrium in economics is the point where supply equals demand for a product, resulting in stable prices and volume of sales.