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Consumer surplus is an important part of the subject economics. It requires thorough study and detail knowledge to score well in the exam. However, students, in today’s age, don’t have enough time to give to any single subject as they need to focus on other main subjects as well. Therefore, they need consumer surplus homework help from subject-matter specialists who can make them understand complex theories with simple equations.

What is consumer surplus?

When you observe a difference between the price that you pay in the market and the value you place on the product, the concept of consumer surplus proves useful to look at it. To define it in simple terms, consumer surplus is derived when a consumer pays less than they are prepared to pay.

What is the relation between consumer surplus and price elasticity of demand?

  • When the demand for goods or services is elastic, consumer surplus stands zero because the price that consumers pay is exactly the same, they are willing to pay.
  • When the demand for the product is inelastic, consumer surplus stands infinite. Under this circumstance, demand does not really respond to price change. Whatever the price of the product, the demanded quantity will always remain the same.
  • The surplus demand curves are assumed to be downward sloping. When the demand for the product is inelastic, there will be greater potential for consumer surplus. Businesses raise the price when the demand stands inelastic.

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