Economics JAMB

A consumer surplus measures the?

A. benefits derived from consuming a cheap commodity
B. excess of total expenditure over total utility
C. difference between marginal utility and marginal cost
D. excess of marginal utility over the price

Correct Answer:

Option C – difference between marginal utility and marginal cost

Explanation

Consumer Surplus is the difference between the price that consumers pay and the price that they are willing to pay. For instance, if Mr. A budgeted N100 for commodity X and ended up buying it for 150, the consumer surplus is 150-100=50.

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