Producer surplus refers to:
A)The total amount producer spends for making the product
B)The area under the demand curve above the equilibrium price
C)The price the producer receives.
D)The difference between producer's revenue from selling the product and the cost of producing it.

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the total revenue a producer receives from selling a product and the total cost of producing it. Option A refers to cost, option B refers to consumer surplus, and option C refers to the price received but not the surplus itself.

Producer Surplus Refers To