Question

Consumer surplus arises because:

• A. Consumer has lot of money
• B. Quality of different units of the same commodity differs
• C. Consumer receives more than what he pays for
• D. None of the above

Answer 1

Answer: (C)

Consumer receives more than what he pays for

Consumer surplus is the excess of amount that the consumer is willing to pay and the amount that the consumer actually pays. Hence, surplus arises because consumer receives more than what he pays for.