Consumer surplus exists when
A) it costs less to produce goods than buyers must pay for them.
B) consumers value the good more highly than what they must pay to buy it.
C) taxes on goods are less than the appropriate amount.
D) the marginal benefit of the good is always equal to or less than the price of the good.
E) the price of the good is greater than the marginal cost of producing a unit of the good.

Question

Quizplus · Accepted Answer

Consumer surplus is the difference between the maximum price a consumer is willing to pay for a good and the actual price they pay. If consumers value the good more highly than what they must pay for it, then they experience consumer surplus. Therefore, option B is the correct answer.

Consumer Surplus Exists When