If Baxter is willing to pay $10 for a haircut and actually pays $10 for a haircut, his consumer surplus is $20.

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between what a consumer is willing to pay for a good or service and what they actually pay. In this case, if Baxter is willing to pay $10 and actually pays $10, then his consumer surplus would be $0, not $20. The formula for consumer surplus is: 
CS = maximum amount willing to pay - amount actually paid 
So, in this case, the calculation would be: 
CS = $10 - $10 
CS = $0

If Baxter Is Willing to Pay $10 for a Haircut