Consumer and Producer Surplus Flashcards
1
Q
Define Consumer Surplus
A
Difference between the price consumers are willing and able to pay for a good/service and the price they actually pay
2
Q
On a graph where is the CS ?
A
Below the demand curve and above the price line
3
Q
Define Producer Surplus
A
Difference between the price producers are willing and able to supply a good/service for and the price they actually pay
4
Q
On a graph where is the PS?
A
Above the supply curve and below the price line
5
Q
Where is Society’s Surplus?
A
CS+PS
