Economics • Economic BasicsMedium
Which of the following best defines 'Consumer Surplus'?
A. The difference between the market price and the minimum price a producer is willing to accept
B. The total income remaining with consumers after paying direct taxes
C. The difference between the maximum price a consumer is willing to pay and the actual market price they pay✓ Correct Answer
D. The excess production of consumer goods over total market demand
💡 Solution & Explanation
Consumer surplus represents the difference between the highest price a consumer is willing to pay and the market price they actually pay, reflecting net economic benefit. Producer surplus measures the corresponding gain for suppliers.
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