Question

How are consumer, producer and market surplus calculated

Answer 1

Answer:

The area of the dotted triangle (representing producer surplus) is calculated as ½ x base x height, with the base of the triangle being the equilibrium quantity (QE) and the height being the equilibrium price (PE). “Total surplus” refers to the sum of consumer surplus and producer surplus.

Answer 2

Explanation:

The area of the dotted triangle (representing producer surplus) iscalculated as ½ x base x height, with the base of the triangle being the equilibrium quantity (QE) and the height being the equilibrium price (PE). “Total surplus” refers to the sum ofconsumer surplus and producer surplus