Producer surplus is usually less than profit

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the price received by sellers and the minimum price they would have been willing to accept for producing the good or service. It is a measure of the benefit producers receive from a transaction. Profit, on the other hand, subtracts production costs from revenue and is a measure of the financial gain for the producer. In some cases, producer surplus and profit may be equal, but in general, profit is higher than producer surplus as it takes into account all costs and not just the minimum acceptable price.

Producer Surplus Is Usually Less Than Profit