Exhibit 15.1

-Refer to Exhibit 15.1,which shows the cost and revenue curves for a natural monopolist-the operator of a subway system.The consumer surplus that results if regulators set the price at $0.50 per trip is shown by the _____

Question

Exhibit 15.1
 
-Refer to Exhibit 15.1,which shows the cost and revenue curves for a natural monopolist-the operator of a subway system.The consumer surplus that results if regulators set the price at $0.50 per trip is shown by the _____

Quizplus · Accepted Answer

Consumer surplus is the area between the demand curve and the price level, up to the quantity demanded. At a price of $0.50 per trip, the consumer surplus is represented by the triangular area under the demand curve and above the price line, which is described as area aef.

Exhibit 15.1 -Refer to Exhibit 15.1,which Shows the Cost and Revenue Curves