Phil and Lasca have always wanted to take a cruise.Although willing to pay $5,000 for a Caribbean cruise for two, they were able to purchase a cruise vacation for two for $3,500.Their total consumer surplus amounted to:
A)$750.
B)$5,000.
C)$1,500.
D)$3,500.
E)$0.

Question

Quizplus · Accepted Answer

Consumer surplus can be defined as the difference between the maximum price a consumer is willing to pay for a product or service and the actual price paid. In this case, Phil and Lasca were willing to pay $5,000 for the cruise, but only paid $3,500, resulting in a consumer surplus of $1,500 ($5,000 - $3,500). Therefore, the correct answer is C.

Phil and Lasca Have Always Wanted to Take a Cruise