Use the following to answer questions:
-(Table: Marginal Benefit, Cost, and Consumer Surplus) The table Marginal Benefit, Cost, and Consumer Surplus shows six consumers' willingness to pay for one iTunes download. If the marginal social cost is constant at $0, then the efficient price is _____ and consumer surplus is _____.
A) $0; $37
B) $1; $36
C) $4; $33
D) $5; $32

Question

Use the following to answer questions: 
-(Table: Marginal Benefit, Cost, and Consumer Surplus) The table Marginal Benefit, Cost, and Consumer Surplus shows six consumers' willingness to pay for one iTunes download. If the marginal social cost is constant at $0, then the efficient price is _____ and consumer surplus is _____.
A) $0; $37 
B) $1; $36 
C) $4; $33 
D) $5; $32

Quizplus · Accepted Answer

The efficient price is $0 because the marginal social cost is $0, meaning there is no cost to society for additional downloads. Consumer surplus is the sum of the differences between each consumer's willingness to pay and the price, which is $0, totaling $37.

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