Comsumer and producer surplus

Question 1

Consumer surplus is..

Answer 1

The difference between the price a consumer is willing and able to pay and the price they actually pay

Question 2

Consumer surplus is always?

Answer 2

The area above market price and below the demand curve

Question 3

What demand curves give a larger consumer surplus?

Answer 3

Inelastic demand curves

Question 4

What is producer surplus ?

Answer 4

The difference between the price the producer is willing to charge and the price they actually charge.

Question 5

Producer surplus is always …

Answer 5

The area below the market price and above the supply curve

Question 6

What increases consumer surplus ?

Answer 6

An increase in demand

Question 7

What causes consumer surplus to decrease ?

Answer 7

Supply shifts left, Could be due to higher costs of production

Question 8

If supply shifts right consumer surplus ..

Answer 8

Price decreases and producer surplus increases

Question 9

Consumer surplus will also increase if ..

Answer 9

demand increases