1. Welfare analysis: Basic conceptsIdentify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither.StatementConsumer SurplusProducer SurplusNeitherEven though I was willing to pay up to $143 for a used laptop, I bought a used laptop for only $138. I sold a watch for $62, even though I was willing to go as low as $52 in order to sell it. Even though I was willing to pay up to $70 for a used textbook and even though the seller was willing to go as low as $57 in order to sell it, we couldn't reach a deal because the government imposed a price ceiling of $51 on the sale of textbooks. 1. Welfare analysis: Basic conceptsIdentify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither.ConsumerProducerStatementSurplusSurplusNeitherEven though I was willing to pay up to $143 for a used laptop, I bought a used laptop for only $138.I sold a watch for $62, even though I was willing to go as low as $52 in order to sell it.Even though I was willing to pay up to $70 for a used textbook and even though the seller waswilling to go as low as $57 in order to sell it, we couldn't reach a deal because the governmentimposed a price ceiling of $51 on the sale of textbooks.

1. Consumer surplus: Since the willingness to pay is $143 but pays only$138 so the consumer surplus…

the following statements best illustrates the concept of consumer surplus, producer surplus, or neither. Statement Consumer Surplus Producer Surplus Neither Even though I was willing to pay up to $143 for a used laptop, I bought a used laptop for only $138. I sold a watch for $62, even though I was willing to go as low as $52 in order to sell it. Even though I was willing to pay up to $70 for a used textbook and even though the seller was willing to go as low as $57 in order to sell it, we couldn't reach a deal because the government imposed a price ceiling of $51 on the sale of textbooks.

the following statements best illustrates the concept of consumer surplus, producer surplus, or neither. Statement Consumer Surplus Producer Surplus Neither Even though I was willing to pay up to $143 for a used laptop, I bought a used laptop for only $138. I sold a watch for $62, even though I was willing to go as low as $52 in order to sell it. Even though I was willing to pay up to $70 for a used textbook and even though the seller was willing to go as low as $57 in order to sell it, we couldn't reach a deal because the government imposed a price ceiling of $51 on the sale of textbooks.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter7: Market Efficiency And Welfare

Section: Chapter Questions

Problem 2P

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1. Welfare analysis: Basic concepts

Identify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither.

Statement	Consumer Surplus	Producer Surplus	Neither
Even though I was willing to pay up to $143 for a used laptop, I bought a used laptop for only $138.
I sold a watch for $62, even though I was willing to go as low as $52 in order to sell it.
Even though I was willing to pay up to $70 for a used textbook and even though the seller was willing to go as low as $57 in order to sell it, we couldn't reach a deal because the government imposed a price ceiling of $51 on the sale of textbooks.

1. Welfare analysis: Basic concepts
Identify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither.
Consumer
Producer
Statement
Surplus
Surplus
Neither
Even though I was willing to pay up to $143 for a used laptop, I bought a used laptop for only $138.
I sold a watch for $62, even though I was willing to go as low as $52 in order to sell it.
Even though I was willing to pay up to $70 for a used textbook and even though the seller was
willing to go as low as $57 in order to sell it, we couldn't reach a deal because the government
imposed a price ceiling of $51 on the sale of textbooks.

Definition Definition Consumer surplus is the consumers' gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price, up to the equilibrium quantity. Producer surplus is the producer's gain from trade. The producer surplus is the area above the supply curve but below the equilibrium price, up to the equilibrium quantity. Consumer surplus is represented by Area A and producer surplus is represented by Area B.

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