Alvaro De La Mora Valle purchases a Borussia Dortmund special jersey for $200, and his consumer surplus is $50. How much is Alvaro willing to pay for the Jersey?
Alvaro's consumer surplus represents the difference between the price he paid ($200) and the maximum price he was willing to pay for the jersey. Therefore, his maximum willingness to pay is determined by adding the consumer surplus ($50) to the price he paid.
Maximum willingness to pay = Price paid + Consumer surplus
Maximum willingness to pay = $200 + $50
Maximum willingness to pay = $250
Therefore, Alvaro is willing to pay $250 for the Borussia Dortmund special jersey.
To calculate how much Alvaro is willing to pay for the jersey, we need to add his consumer surplus to the price he paid.
Consumer surplus is the difference between what a consumer is willing to pay for a good or service and what they actually pay.
In this case, Alvaro's consumer surplus is $50, and he purchased the jersey for $200.
Therefore, Alvaro is willing to pay the jersey's price plus the consumer surplus, which is $200 + $50 = $250.
So, Alvaro is willing to pay $250 for the Borussia Dortmund special jersey.
To determine how much Alvaro is willing to pay for the jersey, we need to calculate his willingness to pay. Willingness to pay represents the maximum amount of money an individual is ready to pay for a certain item or service.
In this case, we know that Alvaro's consumer surplus is $50. Consumer surplus is the difference between the price a consumer pays for a product and the maximum price they are willing to pay. Therefore, we can set up the following equation:
Price Alvaro is willing to pay + Consumer surplus = Purchase price
Let's solve for the price Alvaro is willing to pay:
Price Alvaro is willing to pay + $50 (Consumer surplus) = $200 (Purchase price)
Price Alvaro is willing to pay = $200 - $50 = $150
So, Alvaro is willing to pay $150 for the Borussia Dortmund special jersey.