A Market Has Four Individuals,each Considering Buying a Grill for His

question 42

Multiple Choice

A market has four individuals,each considering buying a grill for his backyard.Assume that grills come in only one size and model.Abe considers himself a grill-master,and finds a grill a necessity,so he is willing to pay $400 for a grill.Butch is a meat-lover,honing his grilling skills,and is willing to pay $350 for a grill.Collin just met the girl of his dreams,and she loves a good grilled steak,so in his effort to impress her he is willing to pay $320 for a grill.Daniel loves grilled shrimp and thinks it might be cheaper in the long run if he buys a grill instead of eating out every time he wants grilled shrimp,so he is willing to pay $200 for a grill. If the market price of grills increases from $310 to $350,given the scenario described:

• A) total consumer surplus would fall by $120.
• B) total consumer surplus would fall by $90.
• C) Collin and Butch would experience a decrease in consumer surplus, but Abe's consumer surplus would rise.
• D) Collin would experience a decrease in consumer surplus, but Abe and Butch would experience a rise in consumer surplus.

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Definitions:

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