Differentiate Between Consumer's Surplus and Producer's Surplus

question 37

Essay

Differentiate between consumer's surplus and producer's surplus.For a rational consumer, consumer's surplus will never be a negative number.Why?

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Definitions:

Mutual Funds

Investment vehicles made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments, and other assets.

Pension Funds

Investment pools that pay for workers' retirements. Contributions are made by employers, employees, or both, and the funds are invested on the employees' behalf.

Secondary Market Transaction

The buying and selling of existing financial securities among investors or traders, which occurs after the initial issuance of the securities.

Issuing Corporation

The company or entity that releases or sells securities, such as stocks or bonds, to raise capital.