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Question : Consumer's surplus is the highest in the case of :

 

Option 1: Durable goods.

Option 2: Luxuries .

Option 3: Comforts .

Option 4: Neccessities .


Team Careers360 15th Jan, 2024
Answer (1)
Team Careers360 24th Jan, 2024

Correct Answer: Neccessities .


Solution : Correct Answer is Neccessities .

The market price of goods is significantly below what consumers would ultimately be willing to pay when there is a high consumer surplus. The level of consumer surplus is highest when it comes to necessities because consumers are willing to pay a very high price for something that is necessary for their survival. High levels of competition, advancements in technology, and producer effectiveness frequently lead to this.

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