Jeanette is willing to pay $100 for the first pair of shoes, $80 for the second pair, $50 for the third, and $30 for the fourth. If shoes cost $50, Jeanette will buy _____ pairs of shoes and her total consumer surplus equals _____.
A) four; $110
B) three; $230
C) three; $80
D) four; $80

Question

Quizplus · Accepted Answer

Jeanette will buy three pairs of shoes because the price of $50 is equal to her willingness to pay for the third pair. Her consumer surplus is the difference between what she is willing to pay and what she actually pays: ($100 - $50) + ($80 - $50) + ($50 - $50) = $80.

Jeanette Is Willing to Pay $100 for the First Pair