The difference between what consumers would be willing to pay for each unit of commodity and what they actually pay for that unit is called ____________.
A)producer surplus
B)consumer surplus
C)reservation price
D)import tariff

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between the maximum price a consumer is willing to pay for a good or service (reservation price) and the actual price they pay. It represents the benefit that consumers receive from being able to purchase a good or service at a lower price than their willingness to pay. A is incorrect because producer surplus is the difference between the actual price received by a seller and the minimum price they were willing to accept. C is incorrect because reservation price is the maximum price a consumer is willing to pay for a good or service. D is incorrect because an import tariff is a tax levied by a government on imported goods.

The Difference Between What Consumers Would Be Willing to Pay