If a marginal cost pricing rule is imposed on the firm in the figure above, the consumer surplus will be
A) zero.
B) $800.
C) $400.
D) $200.

Name: If a marginal cost pricing rule is imposed on the firm in the figure above, the consumer surplus will be A) zero. B) $800. C) $400. D) $200.
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Question

Quizplus · Accepted Answer

A marginal cost pricing rule sets the price equal to the marginal cost, which maximizes consumer surplus. The consumer surplus is the area between the demand curve and the price level set by marginal cost.

If a Marginal Cost Pricing Rule Is Imposed on the Firm