On a Graph,consumer Surplus Is Represented by the Area

question 59

Multiple Choice

On a graph,consumer surplus is represented by the area

• A)between the demand and supply curves.
• B)below the demand curve and above price.
• C)below the price and above the supply curve.
• D)below the demand curve and to the right of equilibrium price.

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Definitions:

Net Present Value

A calculation that compares the value of all cash inflows and outflows of a project or investment by discounting them to their present value.

Straight-Line Depreciation

A technique for distributing the expense of a physical asset across its lifespan in consistent yearly installments.

Required Rate Of Return

The rate that is generally based on the company’s cost of capital.

Operating Costs

Expenses associated with the day-to-day functions of a business, excluding costs related to production.