Multiple Choice
The group of consumers most likely to purchase a particular product are called a:
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5. Consumer and Producer Surplus; Price Ceilings and Floors
Consumer Surplus and Willingness to Pay
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Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
Which term best describes a customer's perception of the benefits received compared to the costs?
A
Price elasticity
B
Producer surplus
C
Consumer surplus
D
Marginal cost
Verified step by step guidance1
Understand the concept being asked: The problem is about a customer's perception of benefits relative to costs.
Recall definitions of the given terms: Price elasticity measures responsiveness of quantity demanded to price changes; Producer surplus is the difference between what producers receive and their costs; Marginal cost is the cost of producing one additional unit.
Identify the term that relates to the difference between what a consumer is willing to pay and what they actually pay, representing the net benefit to the consumer.
Recognize that this net benefit to the consumer is called Consumer surplus, which captures the customer's perception of benefits minus costs.
Conclude that the term best describing the customer's perception of benefits compared to costs is Consumer surplus.
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