Amanda Buys a Ruby for $330 for Which She Was

question 161

Multiple Choice

Amanda buys a ruby for $330 for which she was willing to pay $340. The minimum acceptable price to the seller, Tony, was $140. Amanda experiences

• A) a consumer surplus of $10, and Tony experiences a producer surplus of $190.
• B) a producer surplus of $200, and Tony experiences a consumer surplus of $10.
• C) a consumer surplus of $670, and Tony experiences a producer surplus of $200.
• D) a producer surplus of $10, and Tony experiences a consumer surplus of $190.

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Definitions:

Income

Money received, especially on a regular basis, for work or through investments.

Directly Related

A relationship between two variables in which they move in the same direction.

Consumer's Income

The sum of money a consumer can spend on products and services.

Budget Line

A visual depiction of every potential combination of two products that can be bought within a specific budget at fixed prices.