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 $6 per unit?
A) $20
B) $35
C) $50
D) $70

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 $6 per unit?
A) $20 
B) $35 
C) $50 
D) $70

Quizplus · Accepted Answer

In order to find the total consumer surplus at a price of $6 per unit, we need to find the area under the demand curve and above $6 for all units sold. This area can be split into a triangle with base of 10 units and height of $4 (the difference between the original price of $10 and the current price of $6), and a rectangle with a base of 10 units and a height of $6 (the current market price). The total consumer surplus at a price of $6 per unit is therefore (1/2)(10)(4) + (10)(6) = $50.

The Following Figure Shows the Market Demand Curve for Calculators