Lauren and Katy each bought a new bike lock for $20.Both Lauren and Katy would have paid $25 for the lock.Katy's consumer surplus equaled
A) $10.
B) $40.
C) $5.
D) $20.
E) $50.

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between what a consumer is willing to pay for a good and the actual price they pay. In this case, Katy's consumer surplus would be $5 because she was willing to pay $25 for the lock but only paid $20. Therefore, the correct answer is C.

Lauren and Katy Each Bought a New Bike Lock for $20.Both