Consumer Surplus Is Important to Firms Because

question 38

Multiple Choice

Consumer surplus is important to firms because:

• A) it represents value consumers receive that they do not pay for.
• B) market prices must incorporate consumer surplus.
• C) they must pay taxes based on the level of consumer surplus.
• D) if firms can capture it, they can increase their profitability.
• E) a and d

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Definitions:

Genes

Units of heredity made up of DNA, located on chromosomes, that carry the instructions for the development, functioning, growth, and reproduction of all known organisms.

Analogous

Similar or comparable in certain respects, typically allowing for a comparison to be made.

Ovulation

The phase in the menstrual cycle when a mature egg is released from the ovary, making it available for fertilization.

Fertilization

Union of sperm and ovum to produce a zygote; also called conception.