Question

Serena paid $900 for a camera that she thought was worth $1100 for all the features included in it. For the consumer electronics firm selling the camera, however, the cost of producing the camera was only $350. What is the consumer surplus in this scenario?

Answer 1

$200

Step-by-step explanation:

The consumer surplus refers to the benefit that consumers receive when the price that they pay for a product is lower than the one they were willing to pay. According to this, the consumer surplus in this scenario is $200 because Serena was willing to pay $1100 and she paid $900:

$1100-$900= $200