At market equilibrium, the total benefit that results from all the transactions is

Question

Quizplus · Accepted Answer

At market equilibrium, the demand and supply curves intersect, and the quantity exchanged is where the quantity demanded and supplied are equal. At this point, the price is set, and both consumers and producers have a surplus. The consumer's surplus is the difference between the maximum price they are willing to pay and the market price, and the producer's surplus is the difference between the market price and the minimum price they are willing to accept. The total benefit that results from all the transactions is, therefore, the sum of the consumer surplus and the producer surplus, making choice C the correct answer.

At Market Equilibrium, the Total Benefit That Results from All