Producer surplus is defined as
A)the value that the consumer places on a good over the amount they pay for it.
B)the money that the producer gets from a good over the amount they are willing to sell it for.
C)when quantity supplied is greater than quantity demanded.
D)when quantity demanded is greater than quantity supplied.

Question

Quizplus · Accepted Answer

Producer surplus is the difference between the price the producer receives for a good and the minimum price the producer is willing to sell it for. This can be seen as the extra profit or benefit the producer receives from selling the good. Option A is describing consumer surplus, option C is describing a situation of excess supply, and option D is describing a situation of excess demand, which are not related to producer surplus.

Producer Surplus Is Defined as