Suppose Bianca buys a used a textbook from Sebastian for $55. If Bianca's surplus from this transaction was $10, we can infer that:
A)Bianca's reservation price was $45.
B)Bianca's reservation price was $60, and Sebastian's reservation price was $50.
C)Bianca's reservation price was $65.
D)Sebastian's reservation price was $45.

Question

Quizplus · Accepted Answer

Buyer's surplus is the difference between the buyer's reservation price and the price he or she actually pays. Bianca bought the textbook for $55, so if her surplus was $10, her reservation price must have been $65.

Suppose Bianca Buys a Used a Textbook from Sebastian for $55