Answer
Three haircuts (from firms A, C, and D) should be given to Claire, Gloria, and Phil. The maximum surplus is 11 dollars.
Work Step by Step
Please see the graph.
Jay is willing to pay the least (2 dollars), and the costs for Firm B are the highest (6 dollars). If we match the consumer with the highest willingness to pay with the firm with the lowest costs, we can maximize the surplus.
Claire would be willing to pay 8 dollars, and firm D has costs of 2 dollars. (Surplus is currently 6 dollars).
After Claire and firm D, Gloria has the highest willingness to pay (7 dollars), and firm A has the lowest costs (3 dollars). (Surplus from this pairing is 4 dollars, so total surplus is now 10 dollars.)
After Gloria and firm A, Phil has the highest willingness to pay (5 dollars), and firm C has the lowest costs (4 dollars). (Surplus from this pairing is 1 dollar, so total surplus is now 11 dollars.)
