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Unformatted text preview: Economics: Chapter 6 26/09/2007 13:11:00 Consumer Surplus Willingness to pay: Maximum price at which a person will buy a good. Individual Consumer Surplus: The net gain to an individual buyer from the purchase of a good. It is equal to te difference between the buyers willingness to pay and the price paid. Total Consumer Surplus: The sum of the individual consumer surpluses of all the buyers of a good. Consumer Surplus: Used to refer to both individual and to total consumer surplus. Consumer surplus is equal to the area under the demand curve but above the price. Producer Surplus Cost: Lowest price at which he or she is willing to sell a good. Individual Producer Surplus: Net gain to a seller from selling a good. Equal to the difference between the price received and the sellers cost....
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This note was uploaded on 01/16/2012 for the course ACCT 2001 taught by Professor Lowe during the Fall '08 term at LSU.
- Fall '08