What criteria do consumers apply when deciding whether or not to consume
A)The consumer would consume only if the price is lower than his highest willingness to pay
B)The consumer would only consume if his surplus is greater than zero
C)The consumer would only consume if the price is higher than his highest willingness to pay
D)Both A&B

Question

What criteria do consumers apply when deciding whether or not to consume​
A)​The consumer would consume only if the price is lower than his highest willingness to pay
B)The consumer would only consume if his surplus is greater than zero
C)The consumer would only consume if the price is higher than his highest willingness to pay
D)​Both A&B

Quizplus · Accepted Answer

Consumers would only consume a product if the price is lower than their highest willingness to pay (criteria A) and if their surplus (the difference between the price and their willingness to pay) is greater than zero (criteria B). Therefore, both criteria A and B must be met for the consumer to make the decision to consume. Hence, the best choice is D.

What Criteria Do Consumers Apply When Deciding Whether or Not