Unformatted text preview: : in perfect competition , no producer surplus accrues to the individual firm. This is the same as saying that economic profit is driven to zero. Real-world businesses generally own or control some of their inputs, meaning that they receive the producer's surplus due to them: this is known as normal profit , and is a component of the firm's opportunity costs . If the markets for factors are perfectly competitive as well, producer surplus ultimately ends up as economic rent to the owners of scarce inputs such as land . ...
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This note was uploaded on 05/25/2011 for the course ECON ECON 201 taught by Professor Amsler during the Spring '11 term at Michigan State University.
- Spring '11
- Consumer Surplus