Consumer Surplus Is

question 34

Multiple Choice

Consumer surplus is

• A)positive in the case of a monopolist practising perfect price discrimination.
• B)equal to price minus marginal cost.
• C)less in the case of a single-price monopoly than in the case of a perfectly competitive industry.
• D)zero for a single-price monopolist.
• E)greater in a single-price monopoly than in a perfectly competitive industry.

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Definitions:

Edgeworth Box

A diagram used in microeconomics to show how different allocations of goods can lead to efficiency or inefficiency within a market.

Utility Function

A formula that quantifies the happiness or satisfaction received from consuming certain amounts and combinations of goods and services.

Endowed

Furnished or provided with a particular quality, ability, or asset.

Contract Curve

In an Edgeworth Box diagram, the locus of points representing the set of mutually beneficial allocations between two parties.