Econ Exam Chapter 7

Total surplus is the sum of

consumer and producer surplus

If consumer surplus decreases, what happens to the price

increases

In a market, the marginal buyer is the person who

leaves first if the price were any higher

Total surplus can be used to measure a

market's effiency

A consumer's willingness to pay directly measures how

much a buyer values a good

Efficiency in a market is achieved when the sum of the

producer surplus and consumer surplus is maximized

Cost is a measure of the

sellers willingness to sell

Economists typically measure efficiency using

total surplus

Producer surplus directly measures the

well-being of sellers

On a graph, the area below a demand curve and above the price measures

consumer surplus

what is the amount the buyer is willing to pay minus how much they actually pay

consumer surplus

Supply curve can be used to measure producer surplus because it reflects

sellers cost