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What are the consumer and producer surplus?
Consumer and producer surplus:
At equilibrium P1Q1 (as point B, here demand equals supply)
It is equal to area P1AB, it represents the difference among the amounts buyers into aggregate were willing to pay for the good or service compared to what they really did pay (P1), and in effect the usefulness the buyer received but they did not pay for.
It is equal to area P1BC that represents the difference among the price firms in approx would have accepted for the good or the service supplied compared to that they in fact did receive (P1).
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