Figure: Consumer and Producer Surplus

question 3

Essay

Figure: Consumer and Producer Surplus
(Figure: Consumer and Producer Surplus) Look at the figure Consumer and Producer Surplus.In the accompanying figure, an increase in supply will:
A.increase consumer surplus.
B.decrease producer surplus.
C.increase total surplus.
D.increase consumer surplus and total surplus.

---

Definitions:

Output

The total amount of goods or services produced by a company, industry, or economy within a specific period.

Supply Curve

A graphical representation showing the relationship between the price of a good or service and the quantity of that good or service that a supplier is willing and able to supply.

Total Variable Costs

The sum of all costs that vary with the level of output, including materials and labor directly involved in the production process.

Output

The total amount of goods or services that are produced by a company or an economy.