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Questions tagged [consumer-surplus]

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How big is the consumer surplus for typical consumer goods?

Economic transactions happen when both think it will benefit them - that is, when there are gains from trade on both sides. But that says nothing about the size of that gain. If you're a consumer, ...
Keshav Srinivasan's user avatar
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Consumer surplus from a Hicksian demand curve: what is it?

A Hicksian demand curve indicates how much of a good will be demanded given price holding level of overall utility fixed. When in equilibrium with a supply curve we end up with this area we would ...
EconJohn's user avatar
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Calculating a cross price substitution/income effect

I am given a utility function $U(x,y)$, income $I$ and prices $p_x,p_y$. Then the price of $y$ rises to $p_y' = 3 \cdot p_y$. How are we supposed to calculate the substitution effect and income effect ...
bloopton's user avatar
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Assuming a fall in price, does consumer surplus fall more with elastic or inelastic price elasticity of demand

I know that the total consumer surplus is higher for more inelastic P.E.D values, which makes intuitive sense: People would be willing to pay more than they actually do for inelastic goods e.g. a ...
Hallojvjknvve's user avatar
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effect of tax imposition on consumer and supplier with a price ceiling

Use a supply and demand diagram, suppose there's a valid price ceiling, say at 2. Now we add a specific tax of 1, to suppliers, what is the new consumer surplus, producer surplus, and tax revenue? ...
Nonenicht's user avatar