Asked by Ashley Scott on May 18, 2024
Verified
Total surplus in a market is the number of extra consumers and producers that are not needed for the market to come to an equilibrium price and quantity.
Total Surplus
The sum of consumer surplus and producer surplus in a market, representing the total benefits received by all parties involved.
Equilibrium Price
The price at which the quantity of a good demanded equals the quantity supplied, resulting in market stability.
- Learn about the concept of total surplus, together with its segments: consumer surplus and producer surplus.
Verified Answer
TM
Thulasi MahendrarajahMay 23, 2024
Final Answer :
False
Explanation :
Total surplus in a market represents the difference between the maximum amount consumers are willing to pay for a good or service and the minimum amount producers are willing to accept for that same good or service. It is not related to the number of extra consumers and producers in the market. Therefore, the statement is false.
Learning Objectives
- Learn about the concept of total surplus, together with its segments: consumer surplus and producer surplus.
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