Consumer Surplus: Everything You Need to Know (in under 5 minutes) скачать в хорошем качестве

Consumer Surplus: Everything You Need to Know (in under 5 minutes)

The marginal benefit of a good and the good’s price is measured in $s per- unit. Thus, when performing a welfare analysis, the student should think vertically – with the consumer surplus being the amount the marginal benefit exceeds the price. Consumer surplus is the vertical distance between the price and the dot on the demand curve which represents the MB for that good. So, as stated, the Demand curve is based on the Marginal Benefit each good provides to the consumers. The MB is often referred to as Marginal Private Benefit. The word “Private” is added to the term to communicate benefits received only by the consumer of the good are being considered. Since the consumer will buy any good for which the MPB exceeds the price, the MPB of each good allows us to determine the quantity demanded at each price point (ie the Demand curve). This video is made for 1st year college students or AP/IB Economics students. It focuses on foundational economic concepts.