Answer to Question #181384 in Macroeconomics for Mary Joyce

Question

The demand for Clean-Well company’s product charges P30 per liter, how much revenue the

company will earn, and how much consumer surplus will buyers benefit. Exactly, how much will 

buyers willing to pay for a bottle with 30 liters?

Answer 1

The maximum amount that a consumer of the good is willing to pay for a purchase is the consumer surplus,subtract the actual price of the good. The additional utility, gotten by consumers because the actual price they pay for the good is less than the price they would be willing to pay acts as consumer surplus.

To calculate consumer surplus, we need to have the actual price, and the price that consumers are willing to pay.

The company's revenue is the multiplication of the number of products sold by the selling price.

Buyers are willing to pay for a container with 30 liters of milk

$P30×30=P900$