The consumer surplus from a good is measured by the A) area of the triangle above the market price line and below the marginal benefit curve. B) area above the marginal cost curve. C) area of the rectangle below the market price line. D) area of the triangle above the market price line and above the demand curve. E) sum of the economy's marginal social cost and marginal social benefit.

The consumer surplus from a good is measured by the A) area of the triangle above the market price line and below the marginal benefit curve. B) area above the marginal cost curve. C) area of the rectangle below the market price line. D) area of the triangle above the market price line and above the demand curve. E) sum of the economy's marginal social cost and marginal social benefit.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter7: Market Efficiency And Welfare

Section: Chapter Questions

Problem 1P

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Consumer surplus is a measure of the difference between: a) The price which a consumer has to pay and the cost of producing the good (in a diagram, the area between the market price, and the supply curve). b) The consumer’s willingness to pay, and the cost of production (the area between the demand curve and the supply curve). c) The value which a consumer places on a unit of the good, and the market price (the area between the demand curve and the market price line). d) The marginal revenue from sales and the marginal cost of sales (the area between the marginal revenue and the marginal cost curves).
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