CLEP Microeconomics chapter practice4 questions

11 Consumer Surplus, Producer Surplus, and Efficiency

These questions come directly from the chapter practice in the book. Choose the best answer, check your reasoning, and use the explanation to correct any gap.

Question 1

Question 1 of 4

Maya would walk away if a used book cost more than 42. She buys it for 30. How much surplus does the transaction create for Maya?

Consumer surplus is willingness to pay minus the price paid: $42-30=12.
Show answer and explanation

B. $12

Consumer surplus is willingness to pay minus the price paid: $42-30=12.

Question 2

Question 2 of 4

A seller's minimum acceptable price is 18, and the seller receives 27. Producer surplus is

Producer surplus is the payment received minus the seller's minimum acceptable price: $27-18=9.
Show answer and explanation

E. $9

Producer surplus is the payment received minus the seller's minimum acceptable price: $27-18=9.

Question 3

Question 3 of 4

In a competitive market without externalities, the efficient quantity includes units for which

Each unit adds to total surplus when marginal benefit covers marginal cost. Units beyond that point destroy surplus.
Show answer and explanation

B. marginal benefit is at least marginal cost

Each unit adds to total surplus when marginal benefit covers marginal cost. Units beyond that point destroy surplus.

Question 4

Question 4 of 4

For a linear demand curve, consumer surplus at equilibrium is represented by the area

Consumer surplus lies under demand, which records willingness to pay, and above the market price for units purchased.
Show answer and explanation

D. below demand and above price through the quantity traded

Consumer surplus lies under demand, which records willingness to pay, and above the market price for units purchased.

Quiz complete