A consumer's willingness to pay directly measures
A)the extent to which advertising and other external forces have influenced the consumer's preferences.
B)the cost of a good to the buyer.
C)how much a buyer values a good.
D)consumer surplus.

Question

Quizplus · Accepted Answer

A consumer's willingness to pay is the highest price they are willing to pay for a good or service, which directly measures how much they value the good or service. It is not influenced solely by external forces such as advertising or cost. Additionally, it is not the same as the cost of the good to the buyer, as this may include other factors such as production costs and markup. Finally, consumer surplus is the difference between the amount a consumer is willing to pay for a good and the actual price they pay, which is related to but not the same as willingness to pay.

A Consumer's Willingness to Pay Directly Measures