Total surplus in a market is the total area
A)below the demand curve and above the price.
B)below price and up to the point of equilibrium.
C)below the demand curve and above the supply curve, up to the equilibrium quantity.
D)below the demand curve and above the horizontal axis, up to the equilibrium quantity.

Question

Quizplus · Accepted Answer

Total surplus represents the net benefit received by both producers and consumers from participating in a market. It is measured by the area between the demand and supply curves, up to the equilibrium quantity. This includes the consumer surplus (area below the demand curve and above the price) and the producer surplus (area above the supply curve and below the price). Therefore, option C is the correct choice as it represents the total area between the demand and supply curves up to the equilibrium quantity.

Total Surplus in a Market Is the Total Area