Consumer/Producer Surplus

Question 1

What is Consumer Surplus?

Answer 1

Consumer Surplus is the difference between what consumers are willing to spend and the actual selling price.

Question 2

What is Producer Surplus?

Answer 2

Producer Surplus is the difference between what the producer is willing to sell the item for and what the actual selling price is.

Question 3

Is consumer surplus on the top or the bottom of the equilibrium point on the Supply and Demand Diagram?

Answer 3

Top

Question 4

Is producer surplus on the top or the bottom of the equilibrium point on the Supply and Demand Diagram?

Answer 4

Bottom