Consumer Surplus for an Individual Buyer Is Equal to The

question 28

Multiple Choice

Consumer surplus for an individual buyer is equal to the:

• A)consumer's willingness to pay for the good minus the marginal cost of producing the good.
• B)price of the good minus the marginal cost of producing the good.
• C)consumer's willingness to pay for the good minus the price paid for the good.
• D)marginal cost of the good minus the consumer's willingness to pay for the good.

---

Definitions:

Unavoidable Cost

A cost that cannot be eliminated and must be incurred regardless of the action taken.

Relevant Cost

Costs that are directly tied to a specific managerial decision and will change as a result of that decision, critical for effective cost management and decision-making processes.

Sunk Costs

Costs that have already been incurred and cannot be recovered, and thus should not factor into future decision making.

Sunk Cost

Costs that have already been incurred and cannot be recovered or changed.