ECONOMICS
CONSUMERS
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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profits and costs to firms
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consumer and producer surplus
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the equilibrium price and quantity
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incomes of and prices paid by buyers
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Detailed explanation-1: -the well-being of sellers. Which tools allow economists to determine if the allocation of resources determined by free markets is desirable? equal to the total cost to sellers minus the total value to buyers. equal to consumers’ willingness to pay plus producers’ cost.
Detailed explanation-2: -The consumer surplus refers to the difference between what a consumer is willing to pay and what they paid for a product. The producer surplus is the difference between the market price and the lowest price a producer is willing to accept to produce a good.
Detailed explanation-3: -Consumer surplus, also known as buyer’s surplus, is the economic measure of a customer’s excess benefit. It is calculated by analyzing the difference between the consumer’s willingness to pay for a product and the actual price they pay, also known as the equilibrium price.
Detailed explanation-4: -Key Points. Economic efficiency is the idea that it is impossible to improve the situation of one party without imposing a cost on another. If a situation is economically inefficient, it becomes possible to benefit at least one party without imposing costs on others.
Detailed explanation-5: -Consumer surplus = Maximum price willing to spend – Actual price. Consumer surplus = (½) x Qd x P. Producer surplus = Total revenue – Total cost. 13-Jul-2022