When Looking at a Graph,the Area Above the Supply Curve

question 23

Multiple Choice

When looking at a graph,the area above the supply curve and below market price is defined as:

• A) consumer surplus.
• B) producer surplus.
• C) producer benefit.
• D) business profit.
• E) revenue.

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Definitions:

Diversifiable Risk

Relates to the risk that can be reduced or eliminated from a portfolio by holding a variety of investments.

Non-Diversifiable Risk

A type of investment risk that cannot be eliminated through diversification, arising from factors that affect all companies.

Efficient Markets Hypothesis (EMH)

The hypothesis is that actual capital markets, such as the TSX, are efficient.

CAPM

Capital Asset Pricing Model, a theory that describes the relationship between systematic risk and expected return for assets, particularly stocks.