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When a market is in equilibrium, the total amount of consumer surplus must be--------- the total amount of producer surplus. 1)equal to 2)larger than 3)less than 4)none of these

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

When a market is in equilibrium, the total amount of consumer surplus must be--------- the total amount of producer surplus.

1)equal to

2)larger than

3)less than

4)none of these

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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