Producer Surplus Is the

question 57

Multiple Choice

Producer surplus is the

• A)cumulative difference between the price producers receive and the price they require in order to produce.
• B)difference between the brand name price and the generic brand price.
• C)difference between the suggested retail price and the actual cost.
• D)value of the mark-up over price.
• E)value of extra sales generated by loss leaders.

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Definitions:

Earnings Per Share

A financial ratio that measures the portion of a company's profit allocated to each outstanding share of common stock, indicating the company’s profitability.

Cash Dividends

Cash distributions to shareholders from a company's earnings.

Preferred Stock

A class of ownership in a corporation with a priority claim on assets and earnings before common stock; typically does not have voting rights but has a fixed dividend.

Capital Stock

The total amount of stock, both common and preferred, that a company is authorized to issue according to its corporate charter.