The difference between the total willingness to pay for a good and the amount actually spent measures:
A)the total benefits from consuming the good.
B)the net gain from the production and consumption of the good.
C)the amount by which producers are better off, i.e., producers' surplus.
D)the amount by which consumers are better off, i.e., consumers' surplus.

Question

Quizplus · Accepted Answer

The difference between the total willingness to pay for a good and the amount actually spent is the measure of consumers' surplus. It represents the additional benefit that consumers receive from purchasing a good beyond what they paid for it. In other words, it is the difference between what consumers are willing to pay and what they actually have to pay for a good, and it is a measure of their satisfaction gained from the purchase.

The Difference Between the Total Willingness to Pay for a Good