Consumer Surplus e Willingness to pay is the maximum rice that a buyer is willing and able to pay for a good. oIt measures how much the buyer values the good or service H arc Inc. items and derived items c ht o 2001 by Harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Consumer Surplus uWillingness to pay is the maximum price that a buyer is willing and able to pay for a good. uIt measures how much the buyer values the good or service
Consumer Surplus Consumer surplus is the amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it. Harcourt, Inc. items and derived items copyright o 2001 by Harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Consumer Surplus Consumer surplus is the amount a buyer is willing to pay for a good minus the amount the buyer actually pays for it
Four Possible Buyers'Willingness to Pay… Buyer Willingness to Pay John 100 Paul 80 George 70 Ringo 50 Harcourt, Inc. items and derived items copyright o 2001 by Harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Four Possible Buyers’ Willingness to Pay... Buyer Willingness to Pay John $100 Paul 80 George 70 Ringo 50
Consumer Surplus The market demand curve depicts the various quantities that buyers would be willing and able to purchase at different prices. Harcourt, Inc. items and derived items copyright o 2001 by Harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Consumer Surplus The market demand curve depicts the various quantities that buyers would be willing and able to purchase at different prices
Four Possible Buyers'Willingness to Pay. Price Buyer Quantity Demanded More than $100None 0 S80 to $100 John $7oto$80 John, Paul 50to$70 John, Paul, George 234 $50 or less Ringo H arc Inc items and derived items copyright C 2001 by Harcourt, Inc
Harcourt, Inc. items and derived items copyright © 2001 by Harcourt, Inc. Four Possible Buyers’ Willingness to Pay... Price Buyer Quantity Demanded More than $100 None 0 $80 to $100 John 1 $70 to $80 John, Paul 2 $50 to $70 John, Paul, George 3 $50 or less Ringo 4