Describe your willingness to pay for a certain good, in terms of dollars. Given the current price of that good, what is your consumer surplus?

Now imagine you run a business that sells a good of your choice. How would you use information on consumer's willingness to pay to determine the price at which you sell your good? Please describe the cost of production, average willingness to pay, and consumer and producer surpluses in your example.

4. In a highly competitive market for a good of your choice, would you prefer to be a consumer or a producer? Please explain why, in terms of consumer and producer surplus.

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1 Consumer Surplus Consumer surplus is the difference between the maximum price a consumer is willing to pay for a good or service and the actual price they pay It represents the additional value that ... View the full answer