One interpretation of producer surplus is that it equals:
A) the profits of a firm.
B) the return to the fixed factors of production in an industry.
C) consumer surplus.
D) the difference between the price of a product and its average cost of production.

Question

Quizplus · Accepted Answer

Producer surplus is the return to the fixed factors of production in an industry, representing the difference between what producers are willing to accept for a good versus what they actually receive.

One Interpretation of Producer Surplus Is That It Equals