1.2.8 - Consumer & Producer Surplus Flashcards
1
Q
What Is Consumer Surplus?
A
The difference between the price consumers are willing and able to pay for a good or service and the price they actually pay.
2
Q
What Is Producer Surplus?
A
The difference between the price the producers are willing and able to supply a good or service for and the price they actually receive.
3
Q
What Is Society Surplus?
A
Consumer Surplus + Producer Surplus.
4
Q
Where Is Consumer Surplus Located On A Demand & Supply Curve?
A
Above the price line.
5
Q
Where Is Producer Surplus Located On A Demand & Supply Curve?
A
Below the price line.
