Producers' Surplus Is the Difference Between the Price

question 73

Multiple Choice

Producers' surplus is the difference between the price

• A) sellers receive for a good and the maximum price they would have paid for the good.
• B) sellers receive for a good and the minimum price for which they could have sold the good.
• C) buyers pay for a good and the maximum price they would have paid for the good.
• D) buyers pay for a good and the minimum price for which they would have sold the good.

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Definitions:

Production Possibility Frontiers

A curve depicting all maximum output possibilities for two or more goods, given a set of inputs.

Wheat

A cereal grain that is a worldwide staple food, grown in countless varieties.

Cattle

Domesticated bovine animals that are raised for various purposes including meat (beef and veal), dairy products, leather, and as draught animals.

Opportunity Cost

Opportunity Cost is the value of the best alternative that is foregone when a particular decision is made.