Question

Natasha, nelson, and nikolai are all looking to buy flashlights for a camping trip. natasha is willing to pay $4, nelson is willing to pay $10, and nikolai is willing to pay $20. if the actual price of a flashlight turns out to be $15, what is the total consumer surplus for these three shoppers?

Answer 1

Consumer surplus is the difference between the total amount a consumer is willing to pay for an item and what they actually pay. The total amount that Natasha, Nelson and Nikolai are willing to pay for the flashlight is $34, the amount they do pay is $20. So, the total consumer surplus for them is $14.