At equilibrium in a market for a product, the total revenues received by sellers equal the
A) market producer surplus.
B) total amount spent by buyers on the product.
C) total proﬁts of sellers.
D) market consumer surplus.

Question

Quizplus · Accepted Answer

At equilibrium, the quantity demanded by buyers is equal to the quantity supplied by sellers, which means that the market is clearing at a price where both parties are satisfied. The total revenue received by sellers is calculated by multiplying the price by the quantity sold. Therefore, the total revenues received by sellers equal the total amount spent by buyers on the product. Choice A is incorrect because producer surplus refers to the difference between market price and producer cost, which is not equal to total revenue. Choice C is incorrect because total profits depend on both revenues and costs, and we cannot assume that costs are constant at the equilibrium price. Choice D is incorrect because consumer surplus is the difference between the maximum price consumers are willing to pay and the actual market price, which is not equal to total revenue.

At Equilibrium in a Market for a Product, the Total