The concept of surplus can:
A)show who loses from international trade.
B)show who benefits from a tax.
C)show who loses from minimum wage.
D)show any of these.

Question

Quizplus · Accepted Answer

The concept of surplus can be used to show who loses from international trade, who benefits from a tax, and who loses from minimum wage. The surplus refers to the difference between the price that consumers are willing to pay for a good or service and the price that producers are willing to sell it for. In the case of international trade, domestic producers may lose surplus due to increased competition from foreign producers. In the case of a tax, surplus may shift from the consumers to the government. In the case of minimum wage, surplus may be lost by employers who have to pay higher wages to their workers.

The Concept of Surplus Can