The following figure shows the market demand curve for calculators.

-Refer to the figure above.What is the market-wide consumer surplus when the market price of calculators is $3 per unit?
A) $600
B) $725
C) $1,000
D) $1,120

Question

The following figure shows the market demand curve for calculators.
 
-Refer to the figure above.What is the market-wide consumer surplus when the market price of calculators is $3 per unit?
A) $600 
B) $725 
C) $1,000 
D) $1,120

Quizplus · Accepted Answer

Consumer surplus is the area above the market price and below the demand curve. If the market price is $3, the consumer surplus is calculated as the area of the triangle formed by the demand curve and the price line. The base of this triangle is the quantity at which the demand curve intersects the price line, and the height is the difference between the maximum price consumers are willing to pay and the market price. The area of this triangle gives the consumer surplus, which is $1,000.

The Following Figure Shows the Market Demand Curve for Calculators