Table 7-5
For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Allison, Bob, and Charisse are the only three buyers of oranges, and only three oranges can be supplied per day.
-Refer to Table 7-5. If the market price of an orange is $0.65, then consumer surplus amounts to
A)$3.90.
B)$6.75.
C)$3.60.
D)$7.50.

Question

Table 7-5
For each of three potential buyers of oranges, the table displays the willingness to pay for the first three oranges of the day. Assume Allison, Bob, and Charisse are the only three buyers of oranges, and only three oranges can be supplied per day. 
-Refer to Table 7-5. If the market price of an orange is $0.65, then consumer surplus amounts to
A)$3.90. 
B)$6.75. 
C)$3.60. 
D)$7.50.

Quizplus · Accepted Answer

To calculate the individual consumer surplus for each buyer, we need to find the difference between their willingness to pay and the market price, and then multiply that by the quantity they buy. 
For Allison: (0.75 - 0.65) * 1 = 0.10
For Bob: (0.85 - 0.65) * 1 = 0.20
For Charisse: (1.10 - 0.65) * 1 = 0.45
Adding these up, we get a total consumer surplus of $0.10 + $0.20 + $0.45 = $0.75.

Table 7-5 For Each of Three Potential Buyers of Oranges, the Table