Use the following to answer question:
-(Figure: Consumer Surplus II)Look at the figure Consumer Surplus II.If the price of the good is $2,consumer surplus will equal:
A)$30.
B)$45.
C)$60.
D)$90.

Question

Use the following to answer question: 
-(Figure: Consumer Surplus II)Look at the figure Consumer Surplus II.If the price of the good is $2,consumer surplus will equal:
A)$30. 
B)$45. 
C)$60. 
D)$90.

Quizplus · Accepted Answer

When the price of the good is $2, the quantity demanded is 15 units. The consumer surplus can be calculated as the area below the demand curve and above the price, up to the quantity demanded. This area is a triangle with a base of 15 units (quantity demanded) and a height of $3 ($5 - $2 = $3, the difference between the highest price the consumer is willing to pay and the actual price). Therefore, consumer surplus = 0.5 x base x height = 0.5 x 15 x 3 = $22.50 per unit. Multiplying this by the 2 units gives a total consumer surplus of $45.

Use the Following to Answer Question