Consumer's surplus is the difference between the maximum amount that consumers are willing to pay for a good and the actual price they pay for the good. Therefore, it represents the additional benefit that consumers receive beyond what they paid for the good. It is calculated by finding the area below the demand curve and above the market price.

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Consumer's Surplus

Question 128

Multiple Choice

Consumer's surplus

A) is the gap between total willingness to pay and the total market value of a good.
B) guarantees that the market value of a good in money is equal to the total economic value of the good.
C) is always negative because of diminishing marginal utility.
D) is the total area under a consumer's demand curve.

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