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Consumer Surplus and WIllingness to Pay
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Consumer Surplus and WIllingness to Pay
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5. Consumer and Producer Surplus; Price Ceilings and Price Floors / WIllingness to Pay and Consumer Surplus / Problem 6
Problem 6
If a consumer buys a DVD for \$10 but was willing to pay \$18, how does this transaction illustrate consumer surplus?
A
The consumer surplus is \$18, representing the total willingness to pay.
B
The consumer surplus is \$8, representing the benefit gained from the purchase.
C
The consumer surplus is \$0, as the consumer paid the market price.
D
The consumer surplus is \$10, representing the market price.
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