If a consumer is willing and able to pay $20 for a particular good and if he pays $16 for the good,then for that consumer,consumer surplus amounts to
A)$4.
B)$16.
C)$20.
D)$36.

Question

Quizplus · Accepted Answer

The consumer surplus is the difference between the maximum amount a consumer is willing to pay and the actual price paid. Here, the consumer is willing to pay $20 but actually pays $16. Therefore, the consumer surplus is $20 - $16 = $4.

If a Consumer Is Willing and Able to Pay $20