Ask Question
BusinessBusiness
4 September, 06:03

Suppose the market price is $5. The buyer who buys the first unit of output has a willingness-to-buy equal to $10; the buyer who buys the second unit of output has a willingness-to-buy equal to $9; and the buyer who buys the third unit of output has a willingness-to-buy equal to $8. Total consumer surplus is: $12. $27. $10. $5.

+5
Answers (1)
  1. 4 September, 07:57
    0
    Total consumer surplus is $12

    Explanation:

    Consumer surplus refers to the benefit derived by the consumer from the amount he is willing to pay as against market price. For example, Glee is willing to pay $10 for a product. The market price of the product is $5. His consumer surplus will be $5 (benefit).

    Here, market price is $5.

    Buyer is willing to spend $10 for first unit. Consumer surplus is $5 (10 - 5)

    Buyer is willing to spend $9 for second unit. Consumer surplus is $4 (9 - 5)

    Buyer is willing to spend $8 for third unit. Consumer surplus is $3 (8 - 5)

    Total consumer surplus is $12 (5 + 4 + 3)
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Suppose the market price is $5. The buyer who buys the first unit of output has a willingness-to-buy equal to $10; the buyer who buys the ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Classify each of the following key performance indicators according to the balanced scorecard perspective it addresses. Choose from financial perspective, customer perspective, internal business perspective, or learning and growth perspective.
Answers (1)
Mark runs a home improvement business. He is happy with the level of business he receives, but he wants to learn more about his customers, so he studies information compiled by the U. S.
Answers (1)
Kemper Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials in 2021 at a cost of $1,000,000. At December 31, 2020, the raw materials to be purchased have a market value of $950,000.
Answers (1)
The NuPress Valet Co. has an improved version of its hotel stand. The investment cost is expected to be $72 million and will return $13.5 million for 5 years in net cash flows. The ratio of debt to equity is 1 to 1.
Answers (1)
Identify the items as consumer programs or consumer information sources local chambers of commerce consumer reports state consumer protection offices regulation offices for insurance Consumer Programs Consumer Information Sources
Answers (1)
New Questions in Business
What is the name given to the operations used by most organizations to reach their customer goals? O A. Research and development O B. Universal marketing functions O C. Customer support O D. Market planning
Answers (2)
What term is used to describe spread-out or low-density development beyond the edge of services and employment? edge cities sprawl common-interest developments gated communities?
Answers (1)
Elkins Corporation uses the perpetual inventory method. On March 1, it purchased $33,000 of inventory, terms 2/10, n/30. On March 3, Elkins returned goods that cost $3,000. On March 9, Elkins paid the supplier. On March 9, Elkins should credit:a.
Answers (1)
State the main purpose of a business plan
Answers (2)
Purchase discounts are the same as trade discounts true or false
Answers (1)
Home » Business » Suppose the market price is $5. The buyer who buys the first unit of output has a willingness-to-buy equal to $10; the buyer who buys the second unit of output has a willingness-to-buy equal to $9;
Sign Up Forgot Password?