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_____________ is defined as the difference between what the consumer is willing to pay for a product and what he actually pays?
- a)Consumer burden
- b)Consumer surplus
- c)Price gap
- d)Optimum price
Correct answer is option 'B'. Can you explain this answer?
Verified Answer
_____________ is defined as the difference between what the consumer i...
Consumer surplus happens when the price consumers pay for a product or service is less than the price they're willing to pay. Consumer surplus is the benefit or good feeling of getting a good deal.
Consumer surplus always increases as the price of a good falls and decreases as the price of a good rises.
Consumer surplus always increases as the price of a good falls and decreases as the price of a good rises.
Most Upvoted Answer
_____________ is defined as the difference between what the consumer i...
Consumer Surplus
Consumer surplus is the difference between what a consumer is willing to pay for a product and what he actually pays. It is a measure of the consumer's net benefit from purchasing a product. Consumer surplus occurs when the actual price of a product is less than the maximum price a consumer is willing to pay for it.
Factors Affecting Consumer Surplus
1. Consumer Preferences
The consumer's preferences and tastes for a product determine how much he is willing to pay for it. If a consumer values a product highly, he will be willing to pay a higher price for it.
2. Income Level
The consumer's income level also affects his willingness to pay for a product. Consumers with higher incomes are generally willing to pay more for a product than those with lower incomes.
3. Availability of Substitutes
The availability of substitutes for a product affects the consumer's willingness to pay for it. If there are many substitutes available, the consumer is less willing to pay a high price for the product.
4. Market Conditions
The market conditions, such as the level of competition, affect the consumer's willingness to pay for a product. In a competitive market, the consumer is more likely to find a product at a lower price, which increases his consumer surplus.
Importance of Consumer Surplus
Consumer surplus is an important measure in economics as it helps to determine the value of a product to consumers. It also provides information to producers about the demand for their product and the potential for price increases. Additionally, consumer surplus can be used as a measure of the welfare of consumers in a market economy.
Consumer surplus is the difference between what a consumer is willing to pay for a product and what he actually pays. It is a measure of the consumer's net benefit from purchasing a product. Consumer surplus occurs when the actual price of a product is less than the maximum price a consumer is willing to pay for it.
Factors Affecting Consumer Surplus
1. Consumer Preferences
The consumer's preferences and tastes for a product determine how much he is willing to pay for it. If a consumer values a product highly, he will be willing to pay a higher price for it.
2. Income Level
The consumer's income level also affects his willingness to pay for a product. Consumers with higher incomes are generally willing to pay more for a product than those with lower incomes.
3. Availability of Substitutes
The availability of substitutes for a product affects the consumer's willingness to pay for it. If there are many substitutes available, the consumer is less willing to pay a high price for the product.
4. Market Conditions
The market conditions, such as the level of competition, affect the consumer's willingness to pay for a product. In a competitive market, the consumer is more likely to find a product at a lower price, which increases his consumer surplus.
Importance of Consumer Surplus
Consumer surplus is an important measure in economics as it helps to determine the value of a product to consumers. It also provides information to producers about the demand for their product and the potential for price increases. Additionally, consumer surplus can be used as a measure of the welfare of consumers in a market economy.
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_____________ is defined as the difference between what the consumer i...
Take an example: You want to eat chocolate, and yo
u decided to pay not more than Rs.90. You went to a general
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_____________ is defined as the difference between what the consumer is willing to pay for a product and what he actually pays?a)Consumer burden b)Consumer surplusc)Price gapd) Optimum priceCorrect answer is option 'B'. Can you explain this answer?
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