Consumers waiting in long lines for a new product is an example of:

• A. producer surplus increasing
• B. non-monetary payment as part of willingness to pay
• C. price discrimination by the seller
• D. perfectly elastic demand

Answer: (B)

Verified step by step guidance

1. Step 1: Understand the concept of 'willingness to pay' (WTP), which is the maximum amount a consumer is ready to pay for a good or service, including both monetary and non-monetary costs.
2. Step 2: Recognize that waiting in long lines represents a non-monetary cost (such as time and inconvenience) that consumers endure to obtain the product, which effectively increases their total 'payment' beyond just the price.
3. Step 3: Analyze why this situation is not an example of producer surplus increasing, since producer surplus relates to the difference between what producers receive and their costs, and waiting lines do not directly affect this.
4. Step 4: Consider why this is not price discrimination, which involves charging different prices to different consumers based on willingness or ability to pay, rather than imposing non-monetary costs like waiting.
5. Step 5: Understand that perfectly elastic demand means consumers will only buy at one price and none at any other price, which does not relate to waiting in lines; thus, the correct interpretation is that waiting is a non-monetary payment as part of willingness to pay.