In Economic theory and policy making, andlsquo;Consumer Welfareandrsquo; is deemed to be maximized whena)All individuals are able to purchase goods beyond their means of earningb)A large number of individuals are able to purchase goods at a much lower market price that they were willing to payc)All individuals attain an ideal state of having no demand for any more goods and servicesd)Every individual is able to purchase goods at the exact market price they were willing to payCorrect answer is option 'B'. Can you explain this answer?

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In Economic theory and policy making, ‘Consumer Welfare’ is deemed to be maximized when

a)
All individuals are able to purchase goods beyond their means of earning
b)
A large number of individuals are able to purchase goods at a much lower market price that they were willing to pay
c)
All individuals attain an ideal state of having no demand for any more goods and services
d)
Every individual is able to purchase goods at the exact market price they were willing to pay

Correct answer is option 'B'. Can you explain this answer?

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Test: February 2023 Weekly Current Affair - 2

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In Economic theory and policy making, ‘Consumer Welfare’ i...

Explanation:
Consumer welfare is maximized when a large number of individuals are able to purchase goods at a much lower market price than they were willing to pay. This is because:
- Consumer Surplus: When consumers are able to purchase goods at a lower price than their maximum willingness to pay, they experience consumer surplus. Consumer surplus is the difference between the price they actually pay and the price they were willing to pay. Maximizing consumer welfare involves maximizing consumer surplus.
- Increased Purchasing Power: Lower prices allow consumers to purchase more goods and services with their given income, leading to an increase in their purchasing power. This enhances consumer welfare as individuals can afford more goods and services, improving their standard of living.
- Increased Access: Lower prices make goods more accessible to a larger number of individuals who may have been previously unable to afford them. This increases consumer welfare by ensuring a wider range of individuals can benefit from the consumption of goods and services.
- Competition and Efficiency: Lower prices often result from increased competition in the market, leading to greater efficiency and innovation. This benefits consumers by providing them with better quality products at lower prices, further maximizing consumer welfare.
In conclusion, maximizing consumer welfare by allowing individuals to purchase goods at a much lower market price than they were willing to pay is essential for promoting consumer surplus, increasing purchasing power, enhancing access, and fostering competition and efficiency in the market.

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In Economic theory and policy making, ‘Consumer Welfare’ i...

Consumer welfare refers to the individual benefits derived from the consumption of goods and services. The central idea in consumer welfare is to enhance consumer surplus which is the difference between what people prefer to pay and what they actually pay. The greater the difference, higher is the surplus. It means that the market is allocating goods most efficiently (at competitive prices) to people.

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In Economic theory and policy making, ‘Consumer Welfare’ is deemed to be maximized whena)All individuals are able to purchase goods beyond their means of earningb)A large number of individuals are able to purchase goods at a much lower market price that they were willing to payc)All individuals attain an ideal state of having no demand for any more goods and servicesd)Every individual is able to purchase goods at the exact market price they were willing to payCorrect answer is option 'B'. Can you explain this answer?

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In Economic theory and policy making, ‘Consumer Welfare’ is deemed to be maximized whena)All individuals are able to purchase goods beyond their means of earningb)A large number of individuals are able to purchase goods at a much lower market price that they were willing to payc)All individuals attain an ideal state of having no demand for any more goods and servicesd)Every individual is able to purchase goods at the exact market price they were willing to payCorrect answer is option 'B'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about In Economic theory and policy making, ‘Consumer Welfare’ is deemed to be maximized whena)All individuals are able to purchase goods beyond their means of earningb)A large number of individuals are able to purchase goods at a much lower market price that they were willing to payc)All individuals attain an ideal state of having no demand for any more goods and servicesd)Every individual is able to purchase goods at the exact market price they were willing to payCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for In Economic theory and policy making, ‘Consumer Welfare’ is deemed to be maximized whena)All individuals are able to purchase goods beyond their means of earningb)A large number of individuals are able to purchase goods at a much lower market price that they were willing to payc)All individuals attain an ideal state of having no demand for any more goods and servicesd)Every individual is able to purchase goods at the exact market price they were willing to payCorrect answer is option 'B'. Can you explain this answer?.

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