Consumer and producer surplus

What does consumer surplus measure?

The economic benefit or gain that consumers receive when they buy a product or service at a price that is lower than the maximum price they are willing to pay

What does consumer surplus represent?

The difference between what consumers are willing to pay for a good or service and what they must pay in the market

On a diagram what does the demand curve represent?

The various quantities of a product that consumers are willing to purchase at different prices

On a diagram where is producer surplus found

The area above the supply curve and below the market price

What is producer surplus?

The difference between the price producers are willing and able to supply a product for and the price they receive in the market

Where is consumer surplus found on a diagram?

The area underneath the demand curve and above the market price