chp 7 Flashcards
1
Q
consumer surplus measures…
how is it calculated…
A
…the benefit buyers receive for participating in the market
…the area above the price but below the demand curve
2
Q
producer surplus measures…
how is it calculated…
A
…the beneifti sellers receive from partivpating in the market
…area below the price but above the supply curve
3
Q
an efficient allocation of resources…
A
maximizes the sum of consumer and producer surplus.
4
Q
what point is the max of consumer and producer surplus?
A
the equilibrium
