-In the Above Figure,the Market Is at Its Equilibrium

question 180

Multiple Choice

-In the above figure,the market is at its equilibrium.Area A is equal to

• A) consumer surplus.
• B) total revenue.
• C) marginal benefit.
• D) producer surplus.
• E) total surplus.

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Definitions:

Consumer Surplus

The disparity between the ideal payment consumers are ready to make for a good or service and the real amount paid.

Total Expenditure

The overall amount of money spent by individuals, households, or an economy on goods and services over a specific period of time.

Snob Effect

Negative network externality in which a consumer wishes to own an exclusive or unique good.

Bandwagon Effect

Positive network externality in which a consumer wishes to possess a good in part because others do.