Four people each have a different willingness to pay for one unit of a good: George will pay $15, Glen will pay $12, Tom will pay $10, and Peter will pay $8. If price is equal to $9 per unit then the quantity demanded in the market will be ________ and the consumer surplus for this unit will be ________.
A) 3; $10
B) 3; $37
C) 3; $36
D) 4; $8

Question

Quizplus · Accepted Answer

George, Glen, and Tom will buy the good since their willingness to pay is greater than or equal to the price of $9. The consumer surplus is calculated as the sum of the differences between what each of these three is willing to pay and the price: ($15-$9) + ($12-$9) + ($10-$9) = $6 + $3 + $1 = $10.

Four People Each Have a Different Willingness to Pay for One