Which of the following would be considered a final good in the context of consumer surplus and willingness to pay?

• A. Cotton purchased by a textile factory
• B. Flour sold to a bakery for making bread
• C. Steel used by a manufacturer to produce cars
• D. A new laptop purchased by a student for personal use

Answer: (D)

Verified step by step guidance

1. Understand the definition of a final good: A final good is a product that is purchased by the end consumer for personal use and not for further processing or resale.
2. Identify intermediate goods: Goods like cotton, flour, and steel are used as inputs in the production of other goods. These are called intermediate goods because they are not the end product consumed by the final user.
3. Recognize that consumer surplus and willingness to pay are concepts applied to final goods because they measure the benefit to the end consumer from purchasing a product.
4. Analyze each option: Cotton, flour, and steel are all intermediate goods used in production processes, so they are not final goods. A laptop purchased by a student for personal use is a final good because it is the end product consumed directly.
5. Conclude that the new laptop purchased by a student for personal use is the final good in this context, as it directly relates to consumer surplus and willingness to pay.