The total surplus in a market equals:
A)the value to buyers plus the amount paid by buyers
B)the amount received by sellers less the costs of sellers
C)the value to buyers less the costs of sellers
D)zero, because producer and consumer surplus cancel each other out

Question

Quizplus · Accepted Answer

Total surplus in a market is the sum of consumer surplus and producer surplus. Consumer surplus is the difference between the value that a consumer places on a good and the price that the consumer actually pays. Producer surplus is the difference between the price a producer receives and the cost of production. Therefore, the total surplus in a market is the value to buyers less the costs of sellers.

The Total Surplus in a Market Equals