Economics 9708 · AS & A Level · Cross elasticity of demand

Cross elasticity of demand — practice question

A consumer wanted to buy a new camera and a new armchair. She was willing to pay $500 for either item. She found that the camera was priced at $450 and the armchair at $500. She chose the camera. What were her opportunity cost and her consumer surplus?

  • Aopportunity cost: the armchair; consumer surplus: $50
  • Bopportunity cost: the armchair; consumer surplus: $500
  • Copportunity cost: $50; consumer surplus: $450
  • Dopportunity cost: $450; consumer surplus: $50

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