Question

Maximum consumer surplus arises on ________ of the commodity consumed.

• A. first unit
• B. second unit
• C. all units
• D. all except last unit

Answer 1

Answer: (A)

first unit

Maximum consumer surplus arises on the first unit of the commodity being consumed. This is because the consumer is ready to pay the highest amount for the first unit as it provides the highest marginal utility to the consumer.