Mark has a maximum willingness to pay for Word and Excel of $200 and $30, respectively. Beth has a maximum willingness to pay of $50 and $190, respectively. At a bundle price of $230, Mark and Beth receive total consumer surplus of $10.

Question

Quizplus · Accepted Answer

At a bundle price of $230, Mark and Beth pay a total of $230.
Mark's willingness to pay for the bundle is $200, so he receives consumer surplus of $200 - $230 = -$30 (negative since he is paying more than his maximum willingness to pay).
Beth's willingness to pay for the bundle is $190, so she receives consumer surplus of $190 - $230 = -$40.
However, we are given that the total consumer surplus for both Mark and Beth is $10, which means there is some additional information we don't have to calculate it exactly. But we can see that the total consumer surplus is positive, which means the statement is true.

Mark Has a Maximum Willingness to Pay for Word and Excel