The difference between the lowest price a firm would have been willing to accept and the price it actually receives from the sale of a product is called
A)producer surplus.
B)profit.
C)marginal revenue.
D)price differential.

Question

Quizplus · Accepted Answer

The difference between the lowest price a firm would have been willing to accept (i.e. the production cost) and the price it actually receives from the sale of a product is known as producer surplus. This is because the firm gains a surplus amount over and above the cost of production, which contributes to its profit. This surplus amount represents the value that the firm places on the product above and beyond the actual cost of production.

The Difference Between the Lowest Price a Firm Would Have