What is meant by consumer surplus?

Question

Quizplus · Accepted Answer

Consumer surplus is defined as the difference between the price that consumers are willing to pay for a good or service and the actual price they end up paying. It represents the net gain in satisfaction that consumers derive from purchasing a good, and is measured as the area above the market price and below the demand curve. Thus, option A is the correct definition of consumer surplus. Option B describes the total surplus, which includes both consumer and producer surplus. Option C describes the profit margin, not the consumer surplus. Option D describes the willingness to pay, which is not the same as consumer surplus. Option E describes the total utility, but not the consumer surplus.

What Is Meant by Consumer Surplus