Suppose the market price is $5. The buyer who buys the first unit of output has a willingness-to-buy equal to $10; the buyer who buys the second unit of output has a willingness-to-buy equal to $9; and the buyer who buys the first unit of output has a willingness-to-buy equal to $8. Total consumer surplus is

Question

jim_thompson5910 · Answer

focus on `Suppose the market price is $5. The buyer who buys the first unit of output has a willingness-to-buy equal to $10` for now

what's the consumer surplus for this one buyer?

anonymous · Answer

im thinking $5.00? @jim_thompson5910

jim_thompson5910 · Answer

yes, subtract the max willingness to buy/pay and the market price

jim_thompson5910 · Answer

do the same for the other buyers

then add up all the individual surpluses

anonymous · Answer

ok ...so the other buyer would be 9-5 = 4 
do i add the 4 and 5 together? 
kind of confused

jim_thompson5910 · Answer

and 8-5 = 3 as well

jim_thompson5910 · Answer

so, 5+4+3 = 9+3 = 12 is your total consumer surplus

anonymous · Answer

ohhh thats what i missed ! ok got it now thank you

jim_thompson5910 · Answer

no problem