Micro 1.2.8 Flashcards

1
Q

What is consumer surplus

A

The difference between the total amount consumers are willing and able to pay (demand curve) and amount they actually pay (equilibrium price)

(Above price, under curve)

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2
Q

What is producer surplus?

A

The difference between the price producers are willing and able to supply a good for and the price they actually receive

(Under price, above curve)

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