The Difference Between the Price the Consumer Is Willing to Pay

question 93

Multiple Choice

The difference between the price the consumer is willing to pay for a good or service and what he would have to pay for that unit is called:

• A)​the total gains from trading that unit.
• B)​the gain in producer surplus.
• C)​the gain in consumer surplus.
• D)​the total surplus.

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Definitions:

Consideration

Consideration is the value (such as money, service, or promise) exchanged between parties in a contract, making the agreement legally binding.

Objective Theory

A legal principle stating that the intent in creating a contract is determined by the reasonable interpretation of the parties' actions and statements rather than individual subjective intentions.

Outward Manifestations

Refers to the actions or expressions by parties in a contract that show their intention to enter into the agreement.

Contract Law

The branch of law dealing with the formation, performance, and enforcement of agreements between parties.