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If a marketplace produces $40 in consumer surplus and $20 in producer surplus and has a deadweight loss of $15 then this products value to society with the price control is:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

If a marketplace produces $40 in consumer surplus and $20 in producer surplus and has a deadweight loss of $15 then this products value to society with the price control is:

Consumer’s gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price and up to the equilibrium quantity. Consumer surplus is represented by area A.

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