Economics • Economic BasicsMedium
Which of the following economic concepts describes the minimum price that a seller is willing to accept for a good, compared to the actual price they receive in the market?
A. Producer Surplus✓ Correct Answer
B. Deadweight Loss
C. Economic Rent
D. Quasi-Rent
💡 Solution & Explanation
Producer surplus denotes the financial difference between the minimum price a producer is willing to accept for a good and the actual market price received, appearing graphically above the supply curve. Deadweight loss represents the total welfare loss caused by market inefficiencies, whereas economic rent refers to payments made to a factor of production above its transfer earnings. This concept helps economists measure the economic welfare enjoyed by suppliers in competitive markets.
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