Figure 5-2 -In Figure 5-2, Consumer Surplus Is Measured by the Area

question 116

Multiple Choice

Figure 5-2

-In Figure 5-2, consumer surplus is measured by the area

• A)ABC.
• B)OBCD.
• C)OACD.
• D)DCE.

---

Definitions:

Non-Interest-Bearing Note

A promissory note with no stated interest rate, implying that interest is either implied in the transaction price or nonexistent.

Interest Expense

The expenses a company faces for borrowing money, usually shown on the income statement.

Discount On Notes Payable

This refers to the difference between the face value of a note payable and the amount received by the issuer, representing extra cost to be amortized over the term of the note.

Non-Interest-Bearing Note

A promissory note that does not accrue interest over its lifetime, typically requiring the borrower to repay only the principal amount.