Consumer surplus and Producer surplus

Individual consumer surplus

difference between the buyers willingness to pay and the actual price paid

Consumer surplus

sum of the individual consumer surpluses of all buyers of a good in the market

area bounded by demand curve and y-axis and the actual price the consumers have to pay

consumer surplus increases if price is lowered

Sellers cost

the lowest price at which they are willing are to sell a good or service

Individual producer Surplus

Difference between the actual price received and the sellers cost

Producer surplus

Sum of the individual surpluses of all the sellers of goods in the market

area bounded by the supply curve, the Y-axis, and the actual price received

if price increases, producer surplus increases

Total surplus

sum of consumer surplus and producer surplus