producer surplus

  

Definition

In economics, the difference between the amount that a producer receives from the sale of a good and the lowest amount that producer is willing to accept for that good. The greater the difference between the two prices, the greater the benefit to the producer. On graph of supply and demand, the producer surplus is found above the supply curve and below the point at which the supply and demand curves intersect. See also consumer surplus.

Use producer surplus in a sentence

  • Before I could start running the business for my dad, I would have to learn things like marketing research and producer surplus.

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  • If you want to make the most you can out of a deal you should try to figure out the producer surplus before you do in.

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  • The producer surplus was outstanding for the whole group so we decided to further our relationship with our esteemed producer.

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