Assume that the value of a base model computer to an average consumer is $300, the average price that Dell can charge a consumer for that product is $275, and the average unit cost of producing that product for Dell is $150. For this scenario, which of the following is true?
A. Dell can easily increase its price above $300
B. The profit for Dell on each computer is $150
C. The consumer surplus per computer is $25.
D. The higher the intensity of competitive pressure, the higher the price that Dell can charge relative to $300.
E. The lower the consumer surplus, the greater the value for the money the consumer gets.
Answer: C. The consumer surplus per computer is $25