Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
The difference between what consumers are willing to pay and what they actually pay
B
The total revenue generated from sales
C
The quantity of goods supplied in the market
D
The maximum price consumers are willing to pay
Understanding the Answer
Let's break down why this is correct
Answer
Consumer surplus represents the difference between what consumers are willing to pay for a good and what they actually pay. This concept is closely related to the demand curve, which shows the maximum price consumers are willing to pay at different quantities. For example, if someone is willing to pay $10 for a sandwich but buys it for $7, the consumer surplus is $3. This surplus indicates the benefit consumers receive from purchasing the product at a lower price than they were prepared to pay. Overall, consumer surplus helps to measure the economic welfare of consumers in a market.
Detailed Explanation
Consumer surplus shows the extra benefit people get when they pay less than what they are willing to pay. Other options are incorrect because This option confuses total sales with consumer surplus; This choice mixes up supply with consumer surplus.
Key Concepts
demand curve
Topic
Consumer Surplus and Marginal Analysis
Difficulty
easy level question
Cognitive Level
understand
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