Suppose you buy eight pairs of shoes every spring.This year,your shoe store has a huge sale and you end up buying 12 pairs.How does your consumer surplus now compare to how much it would have been had there been no sale?
A)It is higher.
B)It remains the same.
C)It is lower.

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between the price a consumer is willing to pay for a good or service and the actual price paid. In this case, if you were willing to pay $50 for a pair of shoes and they were on sale for $30, your consumer surplus would be $20. If you buy 8 pairs of shoes at $50 each, your total consumer surplus would be $160. However, if you buy those same 8 pairs of shoes on sale for $30 each, your total consumer surplus would be $320. Therefore, with the sale, your consumer surplus is higher.

Suppose You Buy Eight Pairs of Shoes Every Spring