The Producer Surplus on a Unit of a Good Is

question 403

Multiple Choice

The producer surplus on a unit of a good is the

• A) difference between the marginal social benefit and the marginal social cost.
• B) number of dollars' worth of other goods and services forgone to produce this unit of the good.
• C) difference between the price of the good and the marginal cost of producing the good.
• D) difference between the total cost of the good and the marginal cost.

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Definitions:

Par Value Common Stock

The nominal or face value assigned to common stock shares in the corporation's charter, not necessarily reflecting their market value.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting its liabilities; also known as shareholders' equity.

Retained Earnings Statement

A financial report detailing the modifications in accumulated profits over a certain timeframe.

Prior Period Adjustments

Corrections of errors in financial statements of prior periods or adjustments for omitted transactions.