The concept of consumer surplus is useful in helping evaluate government spending decisions.

Question

Quizplus · Accepted Answer

Consumer surplus represents the difference between what a consumer is willing to pay for a good or service and what they actually pay. It can be useful in evaluating government spending decisions because it can show the potential net benefit to consumers. For example, if government spending on a new park creates $50 million in consumer surplus, that means consumers value the park at $50 million more than they had to pay for it. This can be considered a net benefit to society and can help justify the government spending decision.

The Concept of Consumer Surplus Is Useful in Helping Evaluate