Table 7-8
During the last two days, Chad purchased a latte from two different stores. The table below shows Chad's willingness to pay on each day and his consumer surplus from each purchase.
-Refer to Table 7-8. The price that Chad paid for a latte on the second day is
A)$0.25 less than the amount he paid on the first day.
B)$1.00 less than the amount he paid on the first day.
C)$1.50 less than the amount he paid on the first day.
D)$0.50 less than the amount he paid on the first day.

Question

Table 7-8
During the last two days, Chad purchased a latte from two different stores. The table below shows Chad's willingness to pay on each day and his consumer surplus from each purchase. 
-Refer to Table 7-8. The price that Chad paid for a latte on the second day is
A)$0.25 less than the amount he paid on the first day. 
B)$1.00 less than the amount he paid on the first day. 
C)$1.50 less than the amount he paid on the first day. 
D)$0.50 less than the amount he paid on the first day.

Quizplus · Accepted Answer

According to the table, Chad was willing to pay $4.00 for a latte on the first day and $3.50 for a latte on the second day. The consumer surplus for the first day is $1.50 ($4.00 - $2.50) and for the second day it is $2.00 ($3.50 - $1.50). Therefore, Chad paid $0.50 less on the second day compared to the first day.

Table 7-8 During the Last Two Days, Chad Purchased a Latte from Latte