In a voluntary economic transaction between a buyer and a seller, _____ can earn economic surplus from the transaction.
A)only the buyer
B)only the seller
C)both the buyer and the seller
D)neither the buyer nor the seller

Question

Quizplus · Accepted Answer

Both the buyer and the seller can earn economic surplus from the transaction, as long as the price they agree upon is lower than the maximum price the buyer is willing to pay and higher than the minimum price the seller is willing to accept. The difference between the actual price and these maximum/minimum prices is the economic surplus, which can be divided between the two parties.

In a Voluntary Economic Transaction Between a Buyer and a Seller