Producer surplus is
A) the total difference between the total amount that producers actually receive for an item and the total amount that they would have been willing to accept.
B) the total difference between the total costs firms incur in producing an item and the utility consumers derive from purchasing the item.
C) the total difference between the total amount that consumers are willing to pay for an item and the total amount that producers would like to receive.
D) the total difference between the utility consumers derive from purchasing an item and the total costs firms incur in producing the item.
A
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In one week Alice can produce 5 pairs of shoes or 4 bookshelves while Roger can produce 10 pairs of shoes or 6 bookshelves. Alice has ________ advantage in producing ________
A) an absolute; shoes B) a comparative; shoes C) an absolute; bookshelves D) a comparative; bookshelves
An excess quantity supplied can be corrected by
A) a fall in price. B) legally fixing the price at its present level. C) a decrease in demand. D) an increase in supply.